Wal-Mart says price, merchandise pay off
Wal-Mart officials, bolstered by a rebounding stock price and improved image, told shareholders on Friday that their renewed focus on price and better merchandise is winning over customers who they expect to keep when the sluggish economy improves.
Still, Wal-Mart wants to play a larger role in addressing the financial challenges Americans face, store officials said.
The retailer is striving for greater environmental sustainability and lower health-care costs through its discount drug program for customers.
Wal-Mart shares fell $1.43, or 2.39 percent, Friday to close at $58.37 on the New York Stock Exchange.
Icahn urges Yahoo to consider takeover bid
Hoping to negotiate a compromise, activist investor Carl Icahn urged Yahoo to declare it is willing to accept a takeover offer of $49.5 billion — about $2 billion above Microsoft Corp.’s last bid for the Internet pioneer.
Icahn recommended the price, which works out to $34.375 a share, in a letter he sent Friday to Yahoo Chairman Roy Bostock.
It marks the first time that Icahn has publicly indicated what price he has in mind as he tries to force Yahoo’s sale before the Sunnyvale, Calif.-based company’s annual meeting Aug. 1.
If a deal isn’t done before August, Icahn will try to replace Yahoo’s board with a slate of his own directors and then fire company co-founder Jerry Yang as chief executive.
Delta Air Lines expects $103 million in charges
Delta Air Lines said Friday it will record an additional $103 million in charges related to job cuts and discontinued use of airport facilities.
The Atlanta-based company said in a Securities and Exchange Commission filing that the charges will be recorded in the second quarter, which ends June 30.
Delta said it expects to record a $95 million charge linked to work force reduction programs and an $8 million charge related to the discontinued use of certain airport facilities.
Delta took a $16 million charge in the first quarter for the work force reduction programs. But the carrier said it expected the charge to grow once the voluntary reduction commitments were completed, which occurred in May.
Delta Air Lines shares fell 54 cents, or 7.89 percent, Friday to close at $6.30 on the New York Stock Exchange.
Amazon Web site has temporary outage
Amazon.com’s Web site experienced problems in North America for more than two hours in the middle of the day Friday because of system issues, the online retailer said.
Shortly after 10 a.m. PDT, the company’s retail Web site shut down, giving an error code to anyone visiting it, reports Keynote Systems, a California-based company that measures Web site performance.
At 10:16 a.m., the Web site began reporting troubles. Five minutes later, it went off line. It was back up to 60 percent capability around noon. By 1 p.m., the Web site was at 100 percent, said Shawn White, Keynote’s director of external operations.
Consumer borrowing rate slows during April
The Federal Reserve said Friday that consumer borrowing increased at an annual rate of 4.2 percent in April, slower than the 6.2 percent increase of March.
The slowdown reflected the fact that borrowing in the category that includes credit cards rose at an annual rate of just 0.4 percent, the weakest performance since borrowing in this area actually declined at a 1.8 percent rate in May 2005.
The slowdown in growth in credit cards and other revolving debt was offset somewhat by a surge in borrowing for auto loans and other types of non-revolving credit, which jumped at an annual rate of 6.5 percent, up from the March rate of increase of 5.5 percent.
Freddie Mac chief tries to soothe investors
Freddie Mac’s chief executive tried to reassure shareholders Friday that the mortgage finance company’s fortunes will improve, after a year in which its share price was sliced by more than 60 percent amid a prolonged housing slump.
The second-largest U.S. buyer and backer of home mortgages will be able to emerge from the housing downturn with a robust business, Freddie Mac Chairman and CEO Richard Syron told shareholders at the company’s annual meeting in McLean, Va.
Syron reiterated previous expectations, saying the company expects revenue growth of 15 percent to 20 percent this year, but expects to see losses from bad mortgages rise to as much as $6 billion this year.
Treasury prices rebound as stock indexes sink
Treasury prices rebounded Friday as stocks plunged, with investors returning to less risky assets after a government report revealed a significant jump in the unemployment rate and as oil surged to new record highs.
The benchmark 10-year note rose 0.90 to 99.59 and yielded 3.93 percent, down from 4.04 percent late Thursday.
The 30-year long bond gained 1.59 to 95.84 and yielded 4.63 percent, down from 4.74 percent late Thursday.