The Associated Press
Toyota quarterly profit $1.2 billion as sales recover
TOKYO (AP) - Toyota cruised back to profit in the latest quarter as the world's top carmaker cut costs and hitched a ride on the global auto sales recovery while fighting to salvage its reputation for quality.
But the automaker's top executive and analysts alike said Toyota is still far from a full recovery while another potential blow to its image looms after U.S. federal authorities launched a fresh investigation into a steering recall.
Toyota Motor Corp. said Tuesday that January-March profit totaled 112 billion yen ($1.2 billion) compared with a 766 billion yen loss the year before.
Execs grilled on oil spill 'cascade of failures'
WASHINGTON (AP) - Congress called BP and its drilling partners to account Tuesday for a "cascade of failures" behind the spreading Gulf oil spill, zeroing in on a crucial chain of events at the deep-sea wellhead just before an explosion consumed the rig and set off the catastrophic rupture.
In back-to-back Senate inquiries, executives of the three companies at the heart of the massive spill were chastised by senators over attempts to shift the blame to each other. And they were asked to explain why better preparations had not been made to head off the accident.
The blame game shot into the open Tuesday as the Senate began a hearing into the oil spill that has been contaminating water in the Gulf of Mexico for three weeks and threatens sensitive marshes and marine life from Louisiana to Florida.
SEC: Regulators yet to determine cause of plunge
WASHINGTON (AP) - The head of the Securities and Exchange Commission told a congressional panel Tuesday that regulators need more time to figure out what caused last week's stock market plunge.
SEC Chairman Mary Schapiro said her agency has yet to pinpoint the exact reason for the sell-off that sent the Dow Jones industrial average falling nearly 1,000 points in less than half an hour.
Some causes have been ruled out, she said. The agency's review found no evidence of terrorist activity or computer hacking.
Schapiro said establishing a stronger system for slowing trading during periods of high volatility would help.
China inflation rises as housing, food costs jump
BEIJING (AP) - China's inflation accelerated in April, triggering a sell-off in Chinese stocks Tuesday on fears of overheating and a possible credit clampdown by Beijing that might slow the country's economic recovery.
April consumer prices rose 2.8 percent from a year earlier, below Beijing's full-year target of 3 percent but up 0.4 percentage points from March, the National Bureau of Statistics said.
Foreign companies and investors are watching Chinese inflation because any moves to cool prices might slow stimulus-fueled economic growth that surged to 11.9 percent in the first quarter. That could hurt the global recovery if it weakens demand for foreign iron ore and other imports.
Euphoria fades over euro rescue
BRUSSELS (AP) - The German government backed a $1 trillion rescue package for Europe's troubled currency union as European Union officials readied tougher oversight over budgets and economies of most member countries in an effort to contain the region's troubling debt crisis.
The startling size of the EU package, agreed early Monday, initially lifted the euro and stock markets, but by Tuesday the euphoria had ebbed on concerns that simply making more loans available didn't address the crippling levels of government debt in countries such as Greece and Portugal.
Germany, Europe's richest nation which only reluctantly backed the deal, has demanded that Greece and other countries that use the euro must make sharp spending cuts to curb runaway deficits and public debt in return for financial help.
Stocks mostly hold gains after European bailout
NEW YORK (AP) - The stock market showed signs of stability Tuesday as major indexes held on to most of their rebound from last week's big drop.
The Dow Jones industrial average fell about 37 points after fluctuating for much of the day. Broader indicators were mixed.
Analysts said it was reassuring that the market kept most of its gains from Monday, when the Dow soared 405 points in response to the creation of a bailout fund for weak countries like Greece. Tuesday's trading signaled that the previous day's big move wasn't solely driven by euphoria.
Disney posts 55 percent jump in second quarter earnings
NEW YORK (AP) - The Walt Disney Co. said Tuesday that its earnings in the latest quarter jumped 55 percent on strong box office returns for "Alice in Wonderland."
Disney's earnings offer a partial reading on consumer sentiment. Its amusement parks and movie releases depend on people feeling confident enough to spend their extra cash.
A year ago moviegoers coping with a severe recession largely avoided Disney's "Confessions of a Shopaholic." In the most recent quarter, movie studio profits surged.
NY AG sues money manager in Madoff scandal
NEW YORK (AP) - In the late 1990s, executives at the financial advisory firm Ivy Asset Management decided something about Bernard Madoff didn't add up, and began urging clients to back away from the man later revealed to be Wall Street's greatest fraudster.
Those warnings weren't loud enough, New York's attorney general now says.
The state sued Ivy and two of its former executives Tuesday, claiming they had "disturbing" evidence years ago that Madoff was lying about his investment methods, but played down those suspicions because they feared losing millions of dollars in management fees.
Microsoft gets more aggressive with free software
SEATTLE (AP) - Microsoft Corp. is rolling out a new edition of its Office programs to businesses Wednesday. And for the first time it's offering versions of Word and other programs that work in a Web browser, for free.
Office 2010 marks a milestone in Microsoft's efforts to keep up with an industry shift from programs that run on PCs to free, Web-based ones that can be accessed from any computer. And yet Microsoft must be careful not to undermine its lucrative desktop software business, which accounted for 29 percent of Microsoft's revenue and 51 percent of its operating income in the most recent quarter.
Consumers can start buying Office 2010 or using the free applications on the Web in June.
Merck: Schering-Plough integration is on track
Drugmaker Merck & Co.'s integration of Schering-Plough Corp. is progressing well, with their operations already combined in 16 of its top 20 markets, sales rising in emerging markets and new medicines poised for approval, company executives said Tuesday.
Merck said that since the $41 billion Nov. 3 acquisition, it's been building sales of key products, launching new ones for depression, asthma, fertility problems and other conditions, and retooling its marketing to focus more on doctor and patient needs. However, the company's first effort at producing a biologic drug has flopped.
The Whitehouse Station, N.J., company gave its first business briefing since the deal that made it the world's second-largest pharmaceutical company.
By The Associated Press
The Dow Jones industrial average fell 36.88, or 0.3 percent, to 10,748.26. The Dow dropped by as much as 100 points shortly after the opening bell and rose as much as 89 points in afternoon trading. The index has ended lower in five of the past six days.
The Standard & Poor's 500 index fell 3.94, or 0.3 percent, to 1,155.79, while the Nasdaq composite index rose 0.64, or less than 0.1 percent, to 2,375.31.
On Monday, major stock indexes recorded their biggest advance since March 2009. The Dow rose 3.9 percent, while the S&P 500 index surged 4.4 percent.
Benchmark crude fell 43 cents to settle at $76.37 a barrel on the New York Mercantile Exchange. That's more than $10 below the 18-month high of $87.15 reached last Monday. Oil dropped as low as $75.36 and rose as high as $77.68 during Tuesday's session.
In other Nymex trading in June contracts, heating oil rose 1.99 cents to settle at $2.1401 a gallon, and gasoline added 1.26 cents to settle at $2.1952 a gallon. Natural gas fell 3.9 cents to settle at $4.131 per 1,000 cubic feet.
In London, Brent crude rose 37 cents to close at $80.49 on the ICE futures exchange.