China worries and sinking drugmakers slam stock market
NEW YORK (AP) — Ongoing worries about the health of the Chinese economy and another big sell-off in drugmakers pushed the stock market back toward its lowest level of the year.
Energy and raw material companies dropped on reports that industrial profits at Chinese companies fell sharply in August, heightening worries about a slowdown in the world's second-biggest economy. Health care stocks fell sharply as drugmakers extended a decline that began last week as lawmakers stepped up pressure on the industry over its pricing policies.
Stocks have fallen sharply in August and September on concern that a slowdown in China is worse than previously thought and is spreading to other emerging market economies. The slowdown could start hurting U.S. companies that rely on overseas demand for a large portion of their profits.
German prosecutors investigate former Volkswagen boss
BERLIN (AP) — German prosecutors on Monday opened an investigation against former Volkswagen CEO Martin Winterkorn to establish what his role was in the emissions-rigging scandal that has shaken the world's largest automaker.
The investigation will concentrate on the suspicion of fraud committed through the sale of vehicles with manipulated emissions data, and aims to determine who was responsible, prosecutors in Braunschweig said in a statement.
In the German system, anyone can file a criminal complaint with prosecutors, who are then obliged to examine it and decide whether there is enough evidence to open a formal investigation.
Shell move dims oil prospects, delights environmentalists
ANCHORAGE, Alaska (AP) — Royal Dutch Shell has abandoned its long quest to become the first company to produce oil in Alaska's Arctic waters, darkening the nation's long-term oil prospects and delighting environmental groups that tried to block the project.
After years of effort, Shell is leaving the region "for the foreseeable future" because it failed to find enough oil to make further drilling worthwhile.
The company has spent more than $7 billion on the effort, slogged through a regulatory gauntlet and fought environmental groups that feared a spill in the harsh climate would be difficult to clean up and devastating to polar bears, walruses, seals and other wildlife.
Tangled web surrounds United's aborted Atlantic City routes
NEW YORK (AP) — Desperate to draw visitors to Atlantic City, New Jersey officials gave United Airlines more than $100,000 in incentives to fly to the seaside resort for at least a year. Then, when United abruptly canceled the money-losing routes eight months later, the officials appointed by Gov. Chris Christie decided not to enforce a contract provision that required the airline to repay the money, The Associated Press has learned.
The Atlantic City flights and the debt forgiveness are just two elements of the tangled relationships between the Christie administration, the Port Authority of New York and New Jersey, and United Airlines — New Jersey's eighth-largest employer. For instance, it was a public agency headed by Christie's Transportation Commissioner Jamie Fox — a former United lobbyist — that forgave the airline's debt.
United agreed to fly to the struggling Atlantic City airport at a time when the airline was trying to please the New Jersey politicians who also control the much larger Newark Liberty International Airport, where 68 percent of the passengers fly United. The airline was seeking major concessions at Newark — lower rent, lower fees and a $1.5 billion extension in train service between the airport and New York City on the Port Authority's PATH rail line.
US consumer spending up 0.4 percent in August
WASHINGTON (AP) — U.S. consumer spending rose at a healthy rate in August, while income growth slowed after a big jump in July.
Consumer spending advanced 0.4 percent compared to July, when spending also increased by 0.4 percent, the Commerce Department said Monday. In both months, the figures reflected strong gains in purchases of durable goods such as autos.
Consumer spending accounts for two-thirds of economic activity, and the latest result supports expectations for it to remain strong in the second half of this year. That should help serve as a buffer against a global slowdown that has hurt American manufacturers.
US pending home sales fall in August
WASHINGTON (AP) — Fewer Americans signed contracts to buy homes in August, as pending sales slumped amid broader concerns about the U.S. stock market and global economy.
The National Association of Realtors said Monday its seasonally adjusted pending home sales index fell 1.4 percent to 109.4 last month. Signed contracts to purchase homes have climbed a healthy 6.1 percent over the past 12 months, aided by steady job growth and low mortgage rates.
The August figured indicate that home sales lack the stamina to keep accelerating. Uncertainty in the financial markets and rising prices for homes are stirring doubts about affordability for many would-be buyers.
Alcoa splitting into 2 companies
NEW YORK (AP) — Alcoa will split into two independent companies, separating its bauxite, aluminum and casting operations from its engineering, transportation and global rolled products businesses.
The century-plus-old metals maker has been dealing with a downturn in its smelting business because of lower aluminum prices. The split will create one company focusing on upstream products, including aluminum. The other company will focus on engineered products, which includes the automotive and aerospace segments.
The split is part of a wider movement by companies to spin off units in a bid to boost shareholder value. Often, the strategy helps free the stronger part of a company's business from a weaker segment.
Takata air bag recalls could expand to 7 more companies
DETROIT (AP) — Seven more companies including electric car maker Tesla Motors could be facing recalls because they use air bag inflators made by Takata Corp., according to letters they received last week from U.S. safety regulators.
So far about 23.4 million Takata driver and passenger air bag inflators have been recalled on 19.2 million U.S. vehicles sold by 11 different companies, including Honda and Fiat Chrysler. The inflators can explode with too much force, spewing metal shrapnel. At least eight people have died worldwide and hundreds have been injured because of the problem.
The National Highway Traffic Safety Administration sent letters to Mercedes-Benz, Jaguar-Land Rover, Suzuki, Tesla, Volvo Trucks, Volkswagen and Spartan Motors seeking information on which models have Takata inflators.
Nexstar offers about $1.9 billion in cash, stock for Media General
IRVING, Texas (AP) — Nexstar Broadcasting, attempting to drive a wedge between Media General and Meredith Corp., offered nearly $1.9 billion to buy Media General on Monday.
Media General Inc. earlier this month made a $2.4 billion offer for Meredith, which owns television stations and publishes about 20 magazines. The deal, according to Media General, would create a company with almost 90 television stations in 54 markets and magazines including Better Homes and Gardens and Martha Stewart Living.
Nexstar on Monday bid a combination of cash and stock valued at $14.50 for each Media General share, a 30 percent premium to Media General's closing price Friday.
Whole Foods to cut about 1,500 jobs over next 8 weeks
NEW YORK (AP) — Grocery chain Whole Foods is cutting about 1,500 jobs over the next eight weeks as it looks to lower prices and keep up with competition.
The cuts represent about 1.6 percent of its workforce.
But Whole Foods Market Inc. said in a regulatory filing on Monday that many of the reductions will come through attrition. It anticipates workers whose jobs are cut will find other jobs from the almost 2,000 open positions across the company or from new jobs that'll be created by more than 100 new stores in development.
By The Associated Press=
The Dow Jones industrial average fell 312.78 points, or 1.9 percent, to 16,001.89. The Standard & Poor's 500 index fell 49.57 points, or 2.6 percent, to 1,881.77. The Nasdaq composite fell 142.53 points, or 3 percent, to 4,543.97.
U.S. crude fell $1.27 to close at $44.43 a barrel in New York. Brent Crude, a benchmark for international oils used by many U.S. refineries, fell $1.26 to close at $47.34 in London. Wholesale gasoline fell 4.7 cents to close at $1.349 a gallon. Heating oil fell 4.5 cents to close at $1.477 a gallon. Natural gas fell 0.1 cent to close at $2.563 per 1,000 cubic feet.