FRIDAY
JUNE 24, 2011
S&P 500 1,283.50
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NASDAQ 2,686.75
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BUSINESS TODAY DOW 12,050.00
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Lexus takes top spot in quality survey Industry sees improvement from last year Greg Gardner Detroit Free Press
Toyota Motor Corp. recovered and Ford Motor Co. stumbled in J.D. Power and Associates’ closely watch 2011 initial quality study. The Westlake Village, Calif.-based researcher found consumers increasingly critical of complex technology designed to in-
crease smart phone use in vehicles. Despite the growing amount of technology in cars, the industry improved overall, to an average of 107 problems per 100 vehicles. That translates into about one problem per vehicle. The industry averaged 109 problems per 100 vehicles in 2010 and 108 in 2009. The study evaluated 32 brands based on survey responses from more than 73,000 purchasers and lessees of new 2011 modelyear vehicles after 90 days of ownership. Toyota’s Lexus brand
secured the No. 1 spot in the 2011 annual study, with 73 problems reported for every 100 vehicles, while the carmaker’s namesake brand finished No. 7. Toyota’s fellow Japanese rival, Honda Motor Co. Ltd., and its Acura luxury brand were No. 2 and No. 3, respectively. General Motors Co.’s Cadillac and GMC nameplates were the only two domestic brands to finish above the industry average. Dearborn-based Ford, the top-performing non-luxury brand last year with 93 problems per 100 vehicles,
tumbled to No. 23 with 116 problems per 100 vehicles. In a notable finding, the initial quality of 2011 models that did not undergo major redesigns, improved to a best-ever 103 problems per vehicle. But the number of problems reported among all-new or significantly redesigned models jumped 10 percent from last year (to 122 problems per hundred from 111 last year). Meanwhile, three assembly plants tied for Power’s Platinum quality award for making vehicles that averaged only 24 problems
per 100: Toyota’s Cambridge South plant in Ontario that produces the Lexus RX, Toyota’s Kyushu, Japan, plant that makes the Lexus ES, IS and RX, and Honda’s Greensburg, Ind., factory that makes the Civic. No plants operated by Detroit-area automakers received a top award for initial quality. Last year, GM’s Lansing Grand River plant was ranked third among North and South American plants, while the Cadillac CTS made there was rated the thirdbest entry-level premium car.
TOP VEHICLES
The top scorers in four of the biggest segments of the U.S. auto market in J.D. Power and Associates’ annual quality rankings: » Compact: Honda Civic and Honda Insight hybrid (tie), Toyota Prius hybrid » Midsize: Honda Accord, Subaru Legacy, Toyota Camry » Compact Crossover SUVs: Honda Element, Honda CR-V, Toyota FJ Cruiser » Full-size Pickup Trucks: Ford F-150, Toyota Tundra, Chevrolet Avalanche
Google may be target in probe
REQUESTS FOR JOBLESS BENEFITS RISE
IN BRIEF LOCAL
Owosso’s Memorial eyeing affiliation
Sparrow Health System is preparing a proposal for an affiliate hospital partnership with Memorial Healthcare in Owosso. Lansing-based Sparrow was among five area health systems that received requests for proposals from Memorial. Memorial spokeswoman Irma King said the hospital is not looking for a “buyout,” but an affiliation that would give it access to more services, purchasing power and capital. Sparrow would not provide further details on its proposal. Memorial also sent requests to St. John Providence Health System, Covenant HealthCare, Pennant Health Alliance and McLaren Health Care Corp., which owns Ingham Regional Medical Center in Lansing.
Spartan Motors cuts employees CHARLOTTE —
Spartan Motors Inc. has laid off some workers because of a drop in defense and emergency response business. The specialty vehicle and custom chassis maker did not release the number of cuts, though spokesman Russell Chick said the recent cuts were not “seismic changes.” Spartan had about 670 workers in Charlotte as of April. Spartan has cut contract and temporary workers in the past, significantly reducing its workforce over the past few years.
NATIONAL
Rite Aid loses less money in quarter CAMP HILL, Pa. —
Drugstore chain Rite Aid Corp. lost money during the fiscal first quarter. The company reported Thursday it lost $65.5 million, or 7 cents per share, for the quarter that ended May 28. That was less than the $76 million, or 9 cents per share, it lost one year earlier.
— From staff and wire reports
Joelle Tessler The Associated Press
MOUNTAIN VIEW, Calif. — A published report
ASSOCIATED PRESS FILE PHOTO
Job seekers stand in line this month at a job fair in Southfield. Applications for unemployment benefits rose to a seasonally adjusted 429,000 last week, the Labor Department said Thursday.
Layoffs and housing data point to chronic problems The Associated Press
Lansing-area jobless rate up slightly
WASHINGTON — Sour reports Thursday on the number of people who sought unemployment benefits and buyers of new homes illustrate what Federal Reserve Chairman Ben Bernanke acknowledged Wednesday. Many factors weighing on the economy are proving to be more chronic than first imagined. Applications for unemployment benefits rose to a seasonally adjusted 429,000 last week, the Labor Department said Thursday. It was the biggest jump in a month and marked the 11th straight week that applications have been above 400,000. Elevated unemployment benefit claims signal a worsening job market. New home sales fell in May to a seasonally adjusted annual rate of 319,000, the Commerce Department said. That’s far below the 700,000 homes per year that economists say must be sold to sustain a healthy housing
The Lansing area’s jobless rate ticked up slightly in May as more people sought seasonal work. The jobless rate for Ingham, Clinton and Eaton counties was at 7.9 percent last month, the Department of Technology, Management and Budget reported Thursday. That was up from 7.6 percent in April but down from 9.9 percent in May 2010. Michigan’s jobless rate was 10.3 percent in May, while the national rate was 9.1 percent. State and national rates are adjusted for seasonal factors, while the local unemployment rate is not. Local unemployment rose because more people started looking for summer work, said
Mark Reffitt, regional economic analyst with the state. About 800 jobs were added in the construction sector over the month, while the manufacturing sector added about 200 jobs. Those gains were stronger than the area typically experiences in May, Reffitt said. Clinton, Eaton and Ingham counties continued to come in among the state’s lowest jobless rates. Clinton County ranked second with a jobless rate of 6.7 percent, followed by Eaton County in fourth with 7.2 percent. Ingham County was 10th with a 8.5 percent rate.
market. Sales of new homes have fallen 18 percent in the two years since the recession ended. Stocks fell after the weaker data on housing and layoffs were released. It came one day after the
Fed lowered its outlook for growth and unemployment for the rest of the year. The Dow Jones industrial average dropped 59.67 points to close at 12,050. The Fed cut its economic growth forecast to between
MARKETS StocksRecap Vol. (in mil.) Pvs. Volume Advanced Declined New Highs New Lows
NYSE
NASD
4,331 3,341 1275 1760 27 49
2,018 1,597 1383 1202 42 70
Name AMR AT&T Inc AMD AlcatelLuc Alcoa ACapAgy AmExp Annaly Apple Inc BP PLC BkofAm Bar iPVix rs BerkH B BrMySq CMS Eng CVS Care CedarF Chevron
Div ... 1.72 ... ... .12 5.60e .72 2.59e ... .42e .04 ... ... 1.32 .84 .50 .43e 3.12f
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For more stocks and financial listings, analysis and more, visit our stocks page online at WWW.LSJ.COM
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dd 6.05 +.30 -22.3 9 30.72 -.16 +4.6 7 7.06 ... -13.7 ... 5.33 -.03 +80.1 22 15.28 -.01 -.7 4 28.64 -.21 -.3 14 49.21 -.64 +14.7 8 18.72 +.13 +4.5 16 331.23 +8.62 +2.7 dd 42.58 -.53 -3.6 19 10.71 -.08 -19.7 q 23.55 ... -37.4 17 75.61 -.36 -5.6 15 29.33 +1.59 +10.8 13 19.35 -.22 +4.0 15 36.82 -.63 +5.9 dd 18.81 +.30 +24.1 10 99.36 -1.71 +8.9
— Melissa Domsic Lansing State Journal
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HIGH 12108.73 5308.71 427.13 8101.84 2688.07 1286.60 954.36 13649.24 803.60
LOW 11874.94 5219.94 419.69 7927.08 2627.47 1262.87 934.67 13397.41 783.33
Chimera .62e 6 Cisco .24 12 Citigrp rs .04 13 CitzRepB h ... dd Comcast .45 17 Comerica .40 19 Compuwre ... 20 Corning .20 8 DTE 2.35 14 Deere 1.64f 14 Dell Inc ... 10 DelphiFn .48f 8 DeltaAir ... 16 DrSCBr rs ... q DrxFnBull ... q DowChm 1.00f 19 DryShips ... 7 EMC Cp ... 29 EKodak ... 16 Eaton s 1.36 16 EmergBio ... 24 EngyConv ... dd ExxonMbl 1.88f 11
CLOSE 12050.00 5302.63 423.43 8054.08 2686.75 1283.50 953.65 13625.70 802.68
3.52 -.07 15.47 +.11 39.41 -.10 .65 -.03 23.71 -.21 33.89 -.25 9.61 +.06 17.79 +.06 48.69 -.53 81.73 +.16 16.27 +.06 28.21 ... 9.94 +.35 38.13 -.47 23.29 -.69 35.62 -.36 4.02 -.06 26.59 +.15 3.57 +.07 48.85 +.47 22.01 +.14 1.16 +.05 78.44 -1.38
-14.4 -23.5 -16.7 +5.7 +8.4 -19.8 -17.7 -7.9 +7.4 -1.6 +20.1 -2.2 -21.1 -18.6 -16.4 +4.3 -26.8 +16.1 -33.4 -3.8 -6.2 -74.8 +7.3
CHG. -59.67 +14.43 -3.94 -47.76 +17.56 -3.64 -0.29 -23.54 +2.81
%CHG. -0.49% +0.27% -0.92% -0.59% +0.66% -0.28% -0.03% -0.17% +0.35%
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.24 .04 ... 1.00a .16 .60f ... .48f 1.00 ... .04 .17e ... .85e .84e 1.68e .89e ... .84f 1.00 .64 ... .42
YTD +4.08% +3.84% +4.55% +1.13% +1.28% +2.06% +5.11% +1.99% +2.43%
2.7 percent and 2.9 percent this year, down from its range of 3.1 percent to 3.3 percent in April. The Fed also raised its unemployment rate estimate slightly, saying it would not fall below 8.6 percent this year. In its policy statement, the Fed blamed the worsening outlook in part on temporary factors. High gas prices have forced consumers to spend less on discretionary items, such as appliances and vacations, which help boost growth. And supply disruptions from Japan’s natural disasters have slowed manufacturing growth. The Fed said those problems should abate by the fall, and growth would pick up. But when pressed by reporters, Bernanke acknowledged that some of the troubles are stronger and more persistent. He singled out the weaknesses in the financial sector and the housing market. And he said those problems could linger for some time.
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S&P 500
Close: 1,283.50 Change: -3.64 (-0.3%)
1,280 1,240
DOW DOW Trans. DOW Util. NYSE Comp. NASDAQ S&P 500 S&P 400 Wilshire 5000 Russell 2000
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says federal regulators are preparing to issue subpoenas to Google Inc. and other companies. It comes as authorities gather information for a broad antitrust probe into the Internet search leader’s business practices. The Wall Street Journal reported Thursday the FederalTradeCommission willissuesubpoenas“within days,” which would signal that it has opened a formal investigation. The FTC is looking into whether Google abuses its dominance of Internet search to extend its influence into other lucrative online markets, such as mapping, comparison shopping and travel. Rivals complain that Google Inc., which handles two out of every three Internet searches in the U.S., manipulates its results to steer users to its own sites and services and bury links to competitors. Google and the FTC refused comment. The European Commission and the Texas attorney general have already opened investigations into whether Google uses its enormous clout as a major gateway to the Internet to stifle competition online. The Senate Judiciary Committee’s antitrust subcommittee, too, is examining whether Google gives its own services favorable treatment in search results and is seeking to have either Google Chairman Eric Schmidt or Chief Executive Larry Page testify before the panel. Google’s rivals welcomed the news of an FTC probe, for which the agency has been laying the groundwork for months.
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