Oil futures rise to record after report
Oil futures prices rose sharply Wednesday, briefly climbing above a record $80 a barrel after the government reported a surprisingly large drop in crude inventories and declines in gasoline supplies and refinery activity.
The report from the Energy Department’s Energy Information Administration suggested oil supplies are tightening as demand remains strong. That’s why oil prices are rising despite OPEC’s decision on Tuesday to boost crude production by 500,000 barrels per day this fall, analysts said.
Despite Wednesday’s jump, oil is still well below inflation-adjusted highs hit in early 1980. Depending on the adjustment, a $38 barrel of oil in 1980 would be worth $96 to $101 or more today.
Light, sweet crude for October delivery rose $1.68 to settle at a record $79.91 on the New York Mercantile Exchange after rising as high as $80.18 earlier. October gasoline rose 3.49 cents to settle at $2.016 a gallon.
Target may sell its credit-card portfolio
Target Corp., the discount retailer pressured by investors to boost its shares, may sell its $7 billion credit-card portfolio and increase share buybacks.
Target hired Goldman, Sachs & Co. to help evaluate a potential sale. Any decisions, including a review of its use of debt, will be made by December, the Minneapolis-based company said in a statement.
Alcoa sells stake in China aluminum maker
Alcoa, the biggest U.S. aluminum producer, has sold its nearly 7 percent stake in China’s largest aluminum maker for $2 billion.
Pittsburgh-based Alcoa said Wednesday it will continue to invest in the aluminum industry in China, where it first opened offices in 1993 and currently manufactures foil, fasteners, automotive components and other products.
Alcoa had been an investor in Aluminum Corp. of China Ltd., also known as Chalco, since the Chinese company’s initial public offering in 2001. Its initial investment was less than $200 million.
The company sold its interest for the equivalent of $2.23 a share, a 15 percent discount to Wednesday’s closing price on the Hong Kong Stock Exchange.
Union for meatpackers to sue authorities
A union representing workers at six Swift & Co. meatpacking plants sued federal immigration authorities Wednesday, alleging agents violated the workers’ rights during raids by roughly handling even those not suspected of crimes.
The United Food and Commercial Workers International Union and the eight workers named as plaintiffs in the lawsuit seek unspecified damages and an order to stop U.S. Immigration and Customs Enforcement from conducting what the union says are illegal raids.
ICE officials investigating identity theft arrested 1,297 workers at the plants in December, but union officials have said that more than 12,000 workers were detained against their will during the raids. Swift has estimated the financial impact at up to $50 million.
Judge gives states win in gas-emissions fight
Vermont and several other states scored a victory on Wednesday in their battle to get automakers to comply with rules aimed at reducing global warming.
A federal judge ruled that states can regulate greenhouse gas emissions from vehicles, rejecting automakers’ claims that federal law pre-empts state rules and that technology can’t be developed to meet them.
The limits, slated to start phasing in 2009, would require a 30 percent reduction in carbon dioxide emissions from cars and trucks by 2016, a standard the carmakers have maintained would require average fuel economy standards for cars and the lightest category of trucks of 43.7 miles per gallon.
Washington Mutual will shutter division
Washington Mutual, the largest U.S. savings and loan, will shutter one division that bought mortgages from other home lenders and another that financed mortgage companies.
The closures will result in about 1,000 firings, spokesman Alan Gulick said. The Seattle-based company also plans to hire about 1,000 loan officers in the next few months in its mortgage and bank branches, bringing the total to about 3,000, he said.
Washington Mutual has been shrinking its mortgage business for more than three years after the peak of a record refinancing boom in 2003. Between June 30 and a year earlier, the staff at its home-loans group fell to 12,735, from 15,560, Gulick said.
Treasury prices decline as stocks stay static
Treasury prices fell Wednesday, their recent sharp run-up interrupted by rising stock prices and a return of buyers to the long-dormant corporate bond market.
The benchmark 10-year Treasury note closed down 0.28 points at 102.72 with a yield of 4.41 percent, up from 4.36 percent in late trade Tuesday. Prices and yields move in opposite directions.
The 30-year long bond fell 0.47 points to 105.03 with a 4.69 percent, against 4.65 percent late Tuesday.