Business notes

NATIONAL

N.Y. AIRPORTS TO FIGHT DELAYS

A week before Memorial Day travelers hit the airports, the Transportation Department announced Friday proposals to ease delays emanating from the New York City-area's congested airports, avoid widespread aircraft groundings and better inform travelers about prices and delays. The plans call for:

• Slot auctions at John F. Kennedy International Airport in New York and Newark Liberty International Airport in New Jersey, similar to those proposed last month at LaGuardia Airport in New York. Existing carriers would be forced to auction off some of their slots at the airports.

• Airlines and travel agents must disclose fees for checking a second bag in their online and print ads, and before anyone purchases a ticket.

• Airlines must report new and more complete data on the time passengers spend on the tarmac, an issue that gained prominence after two winter weather-related incidents in recent years when hundreds of passengers were stuck on the tarmac for up to 101/2 hours.

• The Federal Aviation Administration and airlines must improve procedures for requesting and approving alternative solutions for safety directives, and review existing communication rules to ensure "significant safety decisions are made using a clearly documented process" after American Airlines canceled more than 3,000 flights last month to perform overdue inspections on MD-80 aircraft.

OIL PRICES KEEP RISING

Oil prices shot to new highs again Friday as traders, unimpressed by U.S. and Saudi efforts to boost supply, kept buying on the belief that prices had more room to rise. Light, sweet crude for June delivery jumped $2.17 to settle at record close of $126.29 on the New York Mercantile Exchange. Earlier in the session, prices surged to $127.82 a barrel, also a new high.

PAULSON PREDICTS ECONOMIC REBOUND

Treasury Secretary Henry Paulson said Friday that financial markets are "considerably calmer" now than they were two months ago. He predicted the economy will be rebounding by the second half of this year. In a speech to business executives in Washington, Paulson said the drag from housing, which he characterized as still the biggest risk to the economy, will soon be lessened by nearly $100 billion in economic stimulus payments to U.S. households.

FAO SCHWARZ TO OPEN SHOP IN MACY'S

FAO Schwarz will open toy stores in nearly 700 Macy's department stores over the next two years in a move that both stores hope will drive traffic in a tough economic environment. The two companies announced Friday that about 75 full-size FAO Schwarz toy stores will open across the country in the fall, along with about 200 smaller shops that will be up to 300 square feet. Macy's CEO Terry Lundgren told shareholders that FAO Schwarz will open stores in up to 275 of Macy's stores this fall, and the companies plan to expand over the next two years to include 685 Macy's stores that have children's departments.

ABERCROMBIE CHARTS 3% RISE IN PROFITS

Teen retailer Abercrombie & Fitch Co. said Friday that its first-quarter earnings rose 3 percent from a year ago on stronger sales. Abercrombie said it earned $62.1 million, or 69 cents per share, in the three months ended May 3 compared with profits of $60.1 million, or 65 cents a share, a year ago. Sales rose nearly 8 percent to $800.1 million from $742.4 million last year. But sales at stores open at least a year, a key indicator of a retailer's strength, fell 3 percent.

INTERNATIONAL

U.N. FORECASTS SLOWER GLOBAL GROWTH

The world economy is "teetering on the brink" of a severe downturn and is expected to grow only 1.8 percent in 2008, the United Nations said in its mid-year economic projections Thursday. That's down from a global growth rate of 3.8 percent in 2007, and the downturn is expected to continue with only a slightly higher growth of 2.1 percent in 2009, the U.N. report said. The midyear update of the U.N. World Economic Situation and Prospects 2008 blamed the downturn on further deterioration in the U.S. housing and financial sectors in the first quarter.