Stocks rise as manufacturing gains; Netflix rises
NEW YORK (AP) — U.S. stocks are gaining after reports showed that manufacturing in the U.S. and China expanded in June.
Netflix rose 6 percent after analysts at Goldman Sachs raised their outlook on the stock.
Regeneron climbed 7 percent after the French drugmaker Sanofi said it had raised its stake in the company. The two collaborate on drug research.
The Dow Jones industrial average rose 0.8 percent as of noon Eastern time Tuesday. IBM led the Dow higher with a gain of 3 percent.
The Standard & Poor's 500 index rose 0.7 percent, while the Nasdaq composite gained 1.2 percent.
Bond prices fell. The yield on the 10-year Treasury note rose to 2.56 percent.
US manufacturers expanded in June but more slowly
WASHINGTON (AP) — U.S. manufacturing grew in June for the 13th straight month. But the pace of the expansion slowed from May.
The Institute for Supply Management says its manufacturing index dipped to 55.3 in June from 55.4 in May. Any reading higher than 50 signals that manufacturing is expanding.
The trade group of purchasing managers says orders rose at a faster pace last month compared with May. But growth in production slowed. A measure of employment shows that factories added jobs for the 12th straight month at the same pace as in May.
Fifteen of 18 manufacturing industries grew in June, led by furniture makers and mineral producers.
US construction spending up 0.1 percent in May
WASHINGTON (AP) — U.S. construction spending barely increased in May as gains in spending on nonresidential projects such as office buildings and public construction were largely offset by a big drop in home building.
The Commerce Department says construction spending edged up 0.1 percent in May after a much stronger 0.8 percent April increase. The back-to-back gains followed a period of weakness; spending fell in both January and February and was flat in March.
The construction industry has struggled with an unusually severe winter which curtailed building activity in many regions.
Construction activity totaled $958.1 billion at a seasonally adjusted annual rate in May, up 6.6 percent from a year ago.
Economists are forecasting that housing and overall construction will regain momentum in coming months, helping to boost overall economic growth.
CoreLogic: US home prices rose more slowly in May
WASHINGTON (AP) — U.S. home prices rose in May compared with a year earlier, but the gains have slowed.
Data provider CoreLogic says prices increased 8.8 percent in May compared with 12 months earlier. The pace of gains has slowed as more homes have come onto the market, according to CoreLogic.
On a month-to-month basis, prices rose 1.2 percent from April to May. But CoreLogic's monthly figures aren't adjusted for seasonal patterns, such as warmer weather, which can affect sales.
Prices increased the most in Western states, including Hawaii, California and Nevada.
Home sales began to stall in the middle of last year after double-digit price increases and higher mortgage rates made real estate less affordable for many people.
But sales rose last month as price gains have moderated and mortgage rates have dipped.
Dockworkers' contract expires, but trade continues
LOS ANGELES (AP) — The contract that keeps thousands of dockworkers on the job at West Coast ports from San Diego to Seattle expires this afternoon.
But don't expect a disruption in the billions of dollars of trade that crosses the waterfront just yet.
The International Longshore and Warehouse Union has promised to keep negotiating with the association that represents shipping lines and terminal operators at 29 ports.
Tough issues still to be resolved include whether workers should shoulder more of the hefty cost of health care, and the talks are expected to last for weeks. The more they drag out, the more jittery companies will feel.
According to a recent analysis by groups representing retailers and manufacturers, a work stoppage lasting just five days would cost the U.S. economy nearly $10 billion.
GM sales rise 1 percent despite safety recalls
DETROIT (AP) — GM's record number of safety recalls isn't keeping the company's sales from rising. The company says its U.S. sales were up by 1 percent in June, led by the Buick Encore small SUV.
GM has recalled nearly 29 million vehicles this year as it reviews years of safety problems.
Chrysler had its strongest June since 2007. Sales jumped 9 percent amid strong demand for the new Jeep Cherokee SUV. Chrysler's best-seller, the Ram pickup, was up 12 percent over last June.
Toyota and Nissan also saw increases over last June, while sales at Ford and Volkswagen were down.
Southwest opens new chapter: international flights
DALLAS (AP) — After four decades of expanding to all corners of the lower 48 states, Southwest Airlines flies into new territory today — Jamaica, the Bahamas and Aruba.
Southwest is taking over routes flown by AirTran Airways, which it bought in 2011. The company plans to eliminate the AirTran brand by year end.
Southwest Flight 1804 left Baltimore-Washington International Airport this morning for the airline's first overseas flight — to Oranjestad, Aruba. After the first three international destinations, it will add service next month to Cancun and Los Cabos in Mexico, and will start flying to Mexico City and Punta Cana in the Dominican Republic in November.
Twitter names Goldman Sachs executive to CFO post
NEW YORK (AP) — Twitter is hiring a Goldman Sachs executive as its new chief financial officer.
The social media site hired Anthony Noto, 46, to replace current CFO Mike Gupta, who steered the San Francisco company through its IPO in 2013 and is becoming senior vice president for strategic investments in the next month.
Noto was previously managing director in the technology, media and telecom investment banking group at Goldman Sachs.
In the new role Noto will earn an annual salary of $250,000 and be granted a one-time stock award of 1.5 million shares vesting over four years. He'll also get a grant to buy 500,000 additional shares.
Twitter shares rose $1.80, or 4.4 percent, to $42.77 during morning trading. The stock has fallen about 36 percent since the beginning of the year.
AMERICAN APPAREL-OUSTED CEO
Ousted American Apparel CEO increases stake
NEW YORK (AP) — Ousted American Apparel CEO Dov Charney has increased his stake in the clothing chain to nearly 43 percent.
In a regulatory filing, Charney reports he now owns 74.6 million shares. Previously, his stake was 27 percent.
Charney also sent a letter last week to the board seeking a meeting of stockholders on Sept. 25 for the purpose of expanding the board to 15 members, according to the filing.
On Saturday, American Apparel adopted a shareholder rights plan, commonly called a "poison pill," a day after a bid from Charney to increase his control.
On June, 18, the American Apparel's board fired Charney as chairman and suspended him as president and CEO. The move calls for a contractually required 30-day period before he can be terminated. The board cited "alleged misconduct."
SUPREME COURT-GAS PRICE-FIXING
High court to hear natural gas price-fixing claims
WASHINGTON (AP) — The Supreme Court will consider whether a group of energy companies can be sued under state antitrust laws for illegally manipulating natural gas prices more than a decade ago during California's energy crisis.
The justices said today they will hear an appeal from American Electric Power Co., Duke Energy Co. and other natural gas traders arguing that federal law precludes state law claims.
A federal district court sided with the gas traders. But the 9th U.S. Circuit Court reversed, saying retail buyers of natural gas could go forward with their lawsuit. Natural gas customers say the companies falsely reported data to industry trade publications, leading to higher gas prices.
The Supreme Court will hear the case, ONEOK Inc. v. Learjet Inc., in the fall.
SUPREME COURT-PREGNANCY DISCRIMINATION
Justices to take up pregnancy discrimination case
WASHINGTON (AP) — The Supreme Court will take up the pregnancy discrimination claims of a package delivery driver for UPS who was refused a light duty assignment so she could continue working while pregnant.
Peggy Young lost her health benefits when UPS would not grant her light duty or allow her to continue her regular job. Young says the company allows employees with some medical conditions to perform jobs in which they can avoid lifting heavy packages. She returned to work after giving birth.
Lower courts ruled that UPS did not violate the Pregnancy Discrimination Act in dealing with Young.
The case will be argued in the fall or winter.
The Obama administration agreed with Young but said recent changes in federal law could cause courts to rule in another way.
SUPREME COURT-FALSE CLAIMS ACT
Supreme Court to consider KBR whistleblower case
WASHINGTON (AP) — The Supreme Court will consider whether a whistleblower can move forward with a lawsuit claiming defense contracting giant KBR Inc. falsely billed the government for work in Iraq.
The justices today said they will hear the company's appeal of a lower court decision that reinstated former employee Benjamin Carter's lawsuit under the federal False Claims Act.
A federal judge had thrown out the case, ruling that it was filed after a six-year deadline passed. But the 4th U.S. Circuit Court of Appeals said such cases can be filed past the deadline when the country is at war. The appeals court also rejected KBR's argument that Carter wasn't first to file his claims, as the false claims law requires.
The Supreme Court will hear the case in the fall.