Business notes

NATIONAL

$3.73 GAS PRICE PEAK PREDICTED

Oil jumped to another record on Tuesday and the government said it expected gasoline prices to peak at a national average of $3.73 a gallon in June, just as the summer driving season kicks off. The new forecast from the Energy Department came on a day oil futures rose above $122 a barrel in New York trading after rebels in Nigeria renewed their attacks against oil installations. By day's end, crude oil for June delivery closed at a record $121.84 a barrel, up 1.6 percent from Monday's close. Oil prices have nearly doubled in a year. Gasoline is selling for a national average of about $3.61 a gallon, according to AAA, the automobile club, a penny less than the record set on May 1 but 58 cents higher than a year ago. Some private analysts have predicted that gas will surpass $4 a gallon this summer.

FANNIE MAE REPORTS $2 BILLION IN LOSSES

The outlook for the housing market darkened further Tuesday as the nation's largest buyer of home mortgages reported more than $2 billion in quarterly losses and forecast a steeper drop in home prices this year. If Fannie Mae's prediction proves true, the real estate woes could further shake the confidence of consumers already stung by rising food and fuel prices, and an anemic job market. "I think that right now we are in the belly of the cycle," said Fannie Mae's president and CEO, Daniel Mudd. He said home prices fell during the first quarter, "faster than anyone anticipated," and that the company foresees a decline of 7 percent to 9 percent for the year, compared with earlier forecasts of a 5 percent to 7 percent drop.

MAKING A PENNY COSTS MORE THAN 1 CENT

Further evidence that times are tough: It now costs 1.26 cents to make a penny. And the cost of a nickel is more than 7.5 cents. Surging prices for copper, zinc and nickel have some in Congress trying to bring back the steel-made pennies of World War II, and maybe using steel for nickels, as well. Copper and nickel prices have tripled since 2003 and the price of zinc has quadrupled, said Rep. Luis Gutierrez, D-Ill., whose subcommittee oversees the U.S. Mint. Keeping the coin content means "contributing to our national debt by almost as much as the coin is worth," Gutierrez said -- and cost taxpayers an estimated $100 million last year alone. A lousy deal, lawmakers concluded as the House moved toward a vote Tuesday that directs the Treasury secretary to "prescribe" -- suggest -- a new, more economical composition of the nickel and the penny.

SHAREHOLDER PUSHING NEW YAHOO BOARD

After fending off months of threats by Microsoft Corp., Yahoo Inc.'s directors still will have to fight for their jobs as the company's irate shareholders plot a mutiny. Spurred by criticism about the Yahoo's board's response to Microsoft's sweetened takeover offer of $47.5 billion, an activist shareholder is trying to recruit an alternative slate of directors to present at Yahoo's annual meeting July 3. "We are hoping to turn that into 'Independence Day' for Yahoo's shareholders," said Eric Jackson, president of Ironfire Capital.

KENTUCKY

COAL-TO-DIESEL PLANT TO BE IN MUHLENBERG

A company specializing in coal-to-diesel technology will announce Monday that it will build a plant at Powderly in Muhlenberg County, state officials announced Tuesday. The U.S. Department of Energy says coal-derived fuel is much more competitively priced than oil-derived fuel. Several coal-to-liquid fuel plants are under development nationally.

YUM APPROVES INCREASED DIVIDEND

Louisville-based Yum Brands Inc. announced Tuesday that its board of directors had approved a 27 percent increase in the company's quarterly cash dividend from $0.15 to $0.19 a share. Payment will be August 1, 2008.