Oil prices slip; higher fuel costs expected
Oil prices fell Friday as investors sold to lock in profits, but analysts doubt oil’s record-breaking run is over and say gasoline prices are about to start following crude higher.
Gasoline prices have so far held steady or even fallen despite a rally that boosted oil to new records for eight straight trading sessions on the New York Mercantile Exchange.
Oil’s advance has been driven by a combination of the Federal Reserve’s half-point interest rate cut, the falling dollar and concerns that tropical storms will strike key oil and gas installations in the Gulf of Mexico.
Light, sweet crude for November delivery fell 16 cents to settle at $81.62 a barrel on the New York Mercantile Exchange after rising as high as $82.40 earlier.
Starbucks managers sue over overtime
A lawsuit filed on behalf of 900 Starbucks Corp. store managers who say they are glorified baristas and should be eligible for overtime came one step closer to trial Friday.
U.S. District Judge Kenneth Marra in West Palm Beach, Fla., ruled that the plaintiffs in the case were “similarly situated” and the case could continue as a class action. The lawsuit seeks unpaid overtime wages, damages and attorney’s fees that could total tens of millions of dollars.
The case is part of a national tussle over whether many managers are improperly classified as exempt from overtime laws. The managers seeking overtime pay argue that their daily duties are virtually the same as the hourly workers they supervise. Starbucks competitor Caribou Coffee Co. faces a similar case in Minnesota.
Private-equity deal for company collapses
The $8 billion buyout of audio-equipment maker Harman International Industries collapsed Friday, the first major private-equity deal to unravel amid the current credit turmoil and a sobering sign for other big takeovers in the works.
Harman, of the District of Columbia, said its would-be buyers, Kohlberg Kravis Roberts and Goldman Sachs, accused it of breaching a clause in the contract, allowing them to walk away after paying a $225 million termination fee. Harman denied the charge, but it did not describe the nature of the breach. The company and the bidders declined to comment further.
If Harman chooses to fight its buyers, the battle would almost certainly end up in the courts, pitting Sidney Harman, an 88-year-old philanthropist who is married to Rep. Jane Harman, D-Calif., against two of the most powerful titans on Wall Street.
Treasury prices gain, snapping long skid
Long-term Treasury prices managed their first gains in three days Friday, in a partial recovery from a rout sparked by nervousness that a sizable new U.S. rate cut will accelerate inflation.
The benchmark 10-year Treasury note closed 0.5 points higher at 100.91 with a yield of 4.63 percent, down from 4.69 percent at Thursday’s close.
The 30-year long bond gained 1.22 to 101.69 with a yield of 4.89 percent, down from 4.95 percent late Thursday.