Business Highlights


Associated Press

Posted on June 27, 2012 at 6:00 PM

Updated Wednesday, Jun 27 at 6:01 PM


Possible outcomes in pending health care law case

WASHINGTON — Saving its biggest case for last, the Supreme Court is expected to announce its verdict Thursday on President Barack Obama's health care law.

The outcome is likely to be a factor in the presidential campaign and help define John Roberts' legacy as chief justice.

But the court's ruling almost certainly will not be the last word on the nation's tangled effort to address its health care woes. The problems of high medical costs, widespread waste and tens of millions of people without insurance will require Congress and the president to keep looking for answers, whether or not the Affordable Care Act is deemed constitutional.


FDA clears first new weight-loss pill in 13 years

WASHINGTON — The Food and Drug Administration has approved Arena Pharmaceutical's anti-obesity pill Belviq, the first new prescription drug for long-term weight loss to enter the U.S. market in over a decade.

Despite leading to only modest weight loss in clinical studies, the drug appeared safe enough to win the FDA's endorsement, amid calls from doctors for new weight-loss treatments.

The agency cleared the pill for adults who are obese or are overweight with at least one medical complication, such as diabetes or high cholesterol.


Google sells small tablet, challenges Kindle Fire

SAN FRANCISCO — Google is selling a small tablet computer bearing its brand in a challenge to Amazon's Kindle Fire.

The Nexus 7 is designed specifically for Google Play, the online store that sells movies, music, books, apps and other content — the things Inc. also sells for its tablet computer.

Both tablets have screens that measure 7 inches diagonally, smaller than the nearly 10-inch screen on Apple Inc.'s popular iPad. The Nexus 7 will also be light — about three-quarters of a pound, compared with the Kindle Fire's nine-tenths pound. The iPad weighs 1.44 pounds.

The Nexus 7 will ship in mid-July and start at $199, the same price as the Kindle Fire. IPads start at $499. Customers can start ordering the Nexus 7 on Wednesday in the U.S., Canada and Australia.


Court: Bernard Madoff's brother to plead guilty

NEW YORK — The brother of Ponzi scheme king Bernard Madoff is scheduled to plead guilty in a criminal case resulting from the multibillion-dollar fraud, court papers say.

Peter Madoff is the former chief compliance officer at the private investment arm of Bernard Madoff's business.

Court papers show Peter Madoff will plead guilty to conspiracy to commit securities fraud and other offenses including falsifying records.

They also show Madoff agreed to the criminal forfeiture of $143 billion, an amount that represents all the money that's believed to have flowed through the business accounts during the multi-decade scheme, and he has agreed to serve 10 years in prison.


Facebook slides as underwriters give mixed ratings

NEW YORK — The Wall Street analysts who know Facebook best are giving the company's stock a mixed review. Think like, not love.

A flood of analyst reports from 33 banks gave Facebook's stock a mix of "neutral" and "buy" ratings on Wednesday. At least one review equated to a "sell" rating.

At the end of the 40-day quiet period following Facebook's initial public offering, analysts at banks that led the IPO finally could give public opinions on the stock. Their comments offered the first glimpse of what the underwriters really think about Facebook.

Facebook's much-ballyhooed IPO landed with a thud on May 18, with the stock closing just 23 cents above its $38 IPO price. It hasn't fared much better since. On Wednesday, it fell 87 cents, or 2.6 percent, to close at $32.23.


EU's changing faces raise doubts for future

BRUSSELS — The first order of business at European Union summits these days often isn't the continent's dreadful financial crisis.

It's getting to know the people around the table.

The group of leaders that will meet this week in Brussels is a much different crew from the one that met in October 2009, when the crisis in Europe first erupted with the news that Greece was in deep trouble.

The revolving door of European leaders raises the question of how Europe can implement bold and swift decisions when it's not even clear who'll be in charge a few months from now.


Barclays to pay $453M in rate-manipulation case

Barclays PLC and its subsidiaries will pay about $453 million to settle charges that they tried to manipulate interest rates that can affect how much people pay for loans to attend college or buy a house.

Britain's Barclays is one of several major banks reportedly under investigation for such violations.

The incidents occurred between 2005 and 2009 and sometimes took place daily, the U.S. Commodity Futures Trading Commission said Wednesday in announcing the settlement. A $200 million civil penalty levied against Barclays is the largest in the CFTC's history.

Barclays also agreed to pay $160 million as part of an agreement with the Justice Department's criminal division on a related matter. It will also pay nearly $93 million to British regulators. The Justice Department said its related criminal investigation continues.


Judge orders halt to Samsung sales of Galaxy tab

SAN FRANCISCO — A judge ordered Samsung Electronics Co. to halt sales of its Galaxy 10.1 tablet computer while the court considers Apple Inc.'s claim that the South Korean tech giant illegally copied the design of the popular iPad.

U.S. District Judge Lucy Koh said Apple's lawsuit appeared likely to prevail.

Koh had earlier said the two products are "virtually indistinguishable," but she declined in December to take the dramatic step of prohibiting sales of the Galaxy 10.1. She changed her mind after the U.S. Court of Appeals for the Federal Circuit told her to take another look at Apple's request for an injunction.

Samsung said it was disappointed with the court's decision but did not expect the ruling to have a significant impact on its operations.


Stockton to be largest US city to file bankruptcy

STOCKTON, Calif. — In opting to become the nation's largest city to seek federal bankruptcy protection, Stockton is taking a rare financial step of last resort after struggling with the economic downturn, soaring pension costs and contractual obligations.

Stockton, population 290,000, was the seventh U.S. municipality to file this year. It's an increasingly popular option, despite the costs and complications — 13 cities, counties and other government entities filed for bankruptcy protection last year, the most in one year since 1994.

Stockton City Manager Bob Deis said officials were left with little choice but to recommend bankruptcy after failing to hammer out finance agreements with creditors to address the city's $26 million budget shortfall.


Exxon's CEO: Climate, energy fears overblown

NEW YORK — ExxonMobil CEO Rex Tillerson says fears about climate change, drilling and energy dependence are overblown.

Tillerson acknowledged in a speech Wednesday that burning fossil fuels is warming the planet, but he said society will be able to adapt. The risks of oil and gas drilling are well understood and can be mitigated, he said. And dependence on other nations for oil is not a concern as long as access to supply is certain, he said.

Tillerson blamed a public that is "illiterate" in science and math, a "lazy" press, and advocacy groups that "manufacture fear" for energy misconceptions in his speech at the Council on Foreign Relations.

He highlighted that huge discoveries of oil and gas in North America in recent years have reversed a 20-year decline in U.S. oil production. He also trumpeted the global oil industry's ability to deliver fuels during two years of dramatic uncertainty in the Middle East, the world's most important oil- and gas-producing region.


By The Associated Press(equals)

The Dow Jones industrial average closed up 92.34 points at 12,627.01. The Standard & Poor's 500 index rose 11.86 points to 1,331.85. The Nasdaq composite average rose 21.26 points, or 0.7 percent, to 2,875.32.

Benchmark crude rose 85 cents to $80.21 per barrel in New York. Brent crude, which is used to price international varieties of oil, gained 48 cents to $93.50 per barrel in London.

Natural gas rose 7 cents to $2.774 per 1,000 cubic feet. That's the highest closing price since Jan. 11. It rose as high as $2.946 earlier in the day.

Heating oil increased 1.72 cents to $2.5937 per gallon and wholesale gasoline fell 2.47 cents to $2.62 per gallon.