Consumer confidence gains, but economists still cautious
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Americans felt better about the economy in August, as a barometer of sentiment posted the biggest boost in two years amid falling gas prices. Two reports suggested that a bottom could be nearing for the housing market, but economists caution it's too early to proclaim that the worst is over. The Conference Board, a private research group, said Tuesday that its consumer confidence index rose to 56.9, up from a revised 51.9 in July. That's the largest gain since August 2006, and is ahead of the 53 expected by economists surveyed by Thomson/IFR. It's also the second month in a row that sentiment improved, after a six-month slide since January — but it remains about half what it was a year ago.
Fannie, Freddie shares climb second day
Shares of Fannie Mae and Freddie Mac climbed for a second day Tuesday amid expectations in some Wall Street quarters that the mortgage finance giants will be able to weather the housing storm without a government rescue.
Fannie shares rose 43 cents, or 8.3 percent, to $5.62, while Freddie advanced 68 cents, or 20.7 percent, to $3.97.
Housing shows a few signs of revival
Although no one is ready to call it the bottom of the worst housing collapse in decades, there were glimmers this week that the severity could be waning.
Reports Tuesday showed the glut of newly built homes on the market fell to a five-month low last month, while the decline in home prices is starting to ease, and in some cities values are even starting to rise. What's more, existing home sales rose slightly from June to July, according to data Monday.
Mattel awarded $100 million in damages
A federal jury awarded Mattel Inc. $100 million in damages on Tuesday in a federal copyright lawsuit that pitted the house of Barbie against MGA Entertainment Inc., the maker of the saucy Bratz dolls. Damages were awarded for contract interference and copyright infringement. No punitive damages were ordered against MGA. The same jury that decided the damages phase concluded last month that Bratz designer Carter Bryant came up with the Bratz concept while working at Mattel.
Citigroup to pay nearly $18 million
Citigroup Inc. will pay nearly $18 million in refunds and settlement charges for taking $14 million from customers' credit card accounts, California's attorney general said Tuesday. Citigroup will make refunds to the 53,000 customers affected, and pay $3.5 million in damages and civil penalties to the state of California, which had been investigating the questionable practices for three years, the attorney general said. The bank will also pay 10 percent interest to California customers, who accounted for $1.6 million of the money "swept" out of accounts and into a Citi fund between 1992 and 2003.
Top pork processor lists quarterly loss
Smithfield Foods Inc. swung to a loss in its fiscal first quarter as high commodity costs hurt the nation's largest pork producer and processor. Costs for key ingredients such as corn and soybean meal were up more than 33 percent in the quarter and the cost of raising hogs soared 25 percent. The hog production sector lost $38.8 million — down from a profit of $93 million a year ago — on the higher costs. Smithfield said it lost $12.6 million, or 9 cents a share, for the period, down from a profit of $54.6 million, or 41 cents a share, a year earlier.
Starbucks unveils Clover brewing system
Starbucks Corp. unveiled the high-priced and high-taste Clover brewing systems at several Seattle stores Tuesday and says more will follow. Starbucks. announced in April that it was acquiring Clover, made by The Coffee Equipment Co., in a deal with undisclosed terms. The deal frustrated some independent coffee store owners because Starbucks said it would no longer sell the device to others. The Clover, which used to sell for $11,000, makes one cup at a time, but aims to coax out each of the hundreds of flavors in the average coffee bean. The by-the-cup versatility means a wider array of beans can be used. Starbucks says the system is "one of the most significant innovations in coffee brewing since the introduction of the espresso machine."
Compiled from Staff, wire reports