WALL STREET
Dow drops seven points
Most U.S. stocks advanced slightly Wednesday on light volume as investors sifted through mixed economic reports, but blue-chips lagged behind and finished lower on the day.
The Dow Jones industrial average traded between slight gains and losses within a narrow 55-point range and closed down 7.36 points, or less than 0.1 percent, at 13,164.78.
Shares of Merck & Co. and Intel Corp. led the blue-chip barometer lower, both falling about 0.8 percent. Shares of Caterpillar Inc., which fell in sympathy with agricultural equipment maker Deere & Co., closed down 0.3 percent.
Early Wednesday, Deere turned in a third-quarter profit that fell short of Wall Street estimates, and cut its profit forecast for the fiscal year. Shares closed down 6.3 percent.
Cisco Systems Inc. closed up 1.1 percent ahead of its release of fourth-quarter results after the bell. Shares added another 5 percent after-hours after the company topped Wall Street estimates. Cisco also raised its dividend by 75 percent. The S&P 500 index started out lower and then reversed to close up 1.6 points, or 0.1 percent, at 1,405.53. The Nasdaq composite rose 13.95 points, or 0.5 percent, to close at 3,030.93.
MANUFACTURING
Ball sets plant closings
Ball Corp. plans to end production at its metal beverage packaging plants in Columbus, Ohio, and Gainesville, Fla., by the end of the year, affecting about 235 employees. Executive Raymond J. Seabrook said the moves come as demand for standard 12-ounce beverage cans shrinks and demand for specialty beverage can packaging grows. The Columbus plant makes standard 12-ounce cans while the Gainesville plant makes beverage can ends for standard can sizes.
Ball expects to record a total after-tax charge of about $30 million in the third quarter, primarily for employee severance and benefits, facility shutdown costs and other actions. Broomfield, Colo.-based Ball says the roughly 110 plant employees in Columbus and 125 employees in Gainesville can apply for open positions at Ball. Ball employs more than 14,500 people worldwide.
RETAIL
Allegations against Wal-Mart
A letter from two U.S. congressmen suggests Wal-Mart Stores Inc. might have had problems with money laundering and tax evasion at its Mexican subsidiary. It was the latest blow to Mexico’s biggest retailer since news reports in April suggested that Wal-Mart de Mexico, known as Walmex, might have been paying to facilitate store permits with bribes.
The letter from U.S. Reps. Henry Waxman and Elijah Cummings described the new allegations.
“We have obtained internal company documents, including internal audit reports, from other sources suggesting that Wal-Mart may have had compliance issues relating not only to bribery, but also to ‘questionable financial behavior’ including tax evasion and money laundering in Mexico,” the letter said. It was sent to Michael Duke, CEO of Wal-Mart.
Walmex said in a statement that “it has no knowledge that [it] is being investigated by Mexican authorities concerning these issues.”
Westfield profits up
Westfield Group, the world’s biggest shopping mall operator by assets and owner of Westfield Belden Village in Stark County, is seeking joint-venture partners for developments and expansion in Brazil and Asia after a 69 percent surge in project income helped boost first-half earnings.
Westfield’s net income jumped 31 percent in the six months ended June 30, the Sydney-based company said in a statement to the Australian stock exchange. The company said it is looking for more partnerships for developments and plans to earn about $209 million a year managing the projects.
AUTO INDUSTRY
Asbestos in Chinese cars?
Australia’s consumer protection agency said asbestos was found inside vehicles made by China’s Great Wall Motor Co. and Chery Automobile Co., prompting a safety investigation and the recall of about 23,000 units.
Customs and border officers found the banned fiber in imported spare parts, the Australian Competition and Consumer Commission said. Though consumers aren’t at risk during normal use, they should avoid “do-it-yourself” maintenance that may disturb engine and exhaust gaskets, according to the statement.
Asbestos’s resistance to fire, heat and chemicals helped it gain uses in construction and automaking before being banned in 55 nations because of health risks. The findings come at a time when the Chinese carmakers seek to bolster exports amid a slowing economy at home. “It is a blow to the automakers’ reputation,” said Johnny Wong, an analyst with Yuanta Securities Co.
Compiled from staff and wire reports