Exxon Mobil 1Q profit up 17 pct, Marathon edges up 2 percent
HOUSTON (AP) -- Don't expect motorists to sympathize, but Exxon Mobil Corp. says gasoline prices didn't do it any favors in the first quarter.
Still, the world's largest publicly traded oil company said Thursday it earned $10.9 billion to start 2008, the second-biggest U.S. quarterly profit ever. The smaller Marathon Oil Corp. said its profit rose 2 percent to $731 million, well ahead of Wall Street forecasts.
As in the past, the extraordinary results from Exxon Mobil prompted critics to insist the company and other major oil producers were profiting at the expense of frustrated consumers, who are paying more than ever to drive. Indeed, retail gas prices on Thursday rose to a new high above $3.62 a gallon.
But because gasoline prices have not kept pace with oil's stunning ascent to triple digits, Exxon Mobil and other big oil companies have seen far lower margins from refining and selling gasoline and other petroleum products.
That's because Exxon Mobil and others don't produce enough oil to satisfy their refining operations, so they have to buy crude at market prices too.
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Consumer spending up mainly because of sharp price increases
WASHINGTON (AP) -- Don't be fooled by a larger-than-expected increase in consumer spending. People aren't buying more -- they're just paying more for their purchases, raising doubts about whether the 130 million stimulus payments the government began sending out this week will be enough to lift consumers' sagging spirits.
The Commerce Department reported Thursday that consumer spending was up 0.4 percent, double the increase that economists had forecast. However, once inflation was removed, spending edged up a much slower 0.1 percent.
The March reading was the fourth straight lackluster performance and did nothing to alleviate worries that consumer spending, which accounts for two-thirds of total economic activity, remains under severe strains, reflecting an economy beset by multiple problems.
Rising food costs, soaring energy prices and rising unemployment have pushed consumer confidence to the lowest levels in five years. Incomes in March rose a weak 0.3 but after removing inflation, after-tax incomes were flat.
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Stocks rise as dollar advances on optimism about US economy
NEW YORK (AP) -- Wall Street shot higher Thursday as investors, while anticipating another dismal jobs report Friday, viewed the rising dollar and falling oil prices as promising signs for the economy. The Dow Jones industrial average rose nearly 190 points to finish above 13,000 for the first time since Jan. 3.
Banks, homebuilders, chip makers and retailers surged, after getting battered earlier this year due to worries about the mortgage crisis and its effect on the global economy.
Stock market participants seem to have already accounted for the current economic weakness. With the government sending stimulus checks to taxpayers and Fed rate cuts still working their way through the financial system, many investors are confident the economy will rebound in the second half of the year.
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Small cars post gains, trucks fall as gas prices rise
DETROIT (AP) -- Small cars were the big winners in April, as high gas prices accelerated U.S. consumers' rush away from trucks and sport utility vehicles and makers of fuel-efficient models scored gains despite the weak economy.
General Motors, Ford and Chrysler all saw double-digit U.S. sales declines compared to last April. But Nissan's sales were up 7 percent on the strength of its car sales, while Toyota's sales edged up 3 percent. Honda's sales figures were delayed because of a technical problem, but the automaker said April sales were likely to be up at least 6 percent.
Pickup sales have been falling for months because of the slowdown in housing construction, and the trend away from SUVs began several years ago as Baby Boomers aged and roomy but more fuel-efficient crossover vehicles gave consumers more choice. But automakers and industry watchers said gas prices are speeding the trend.
General Motors Corp. said its truck and SUV sales fell 27 percent, outweighing increases in car and crossover sales and the company's best-ever month for hybrids. GM's overall sales dropped 16 percent for the month compared with last April.
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Oil prices slide as the dollar extends its gains
NEW YORK (AP) -- Another jump in the dollar and the end of an oil workers' strike in Nigeria sent crude prices falling Thursday as speculators who drove crude futures to nearly $120 pulled out of the market. Retail gas prices, meanwhile, rose to a new record above $3.62 a gallon.
The dollar's rise against the euro and other currencies stripped away some of oil's appeal to investors who have been betting for months that the greenback would continue to falter. When the greenback gains ground, commodities such as oil lose their value as a hedge against inflation, prompting selling. Also, a stronger dollar makes oil more expensive to investors overseas.
As the dollar has strengthened this week, oil futures have dropped more than $7 from their highs to their lowest levels since April 14. On Thursday, light, sweet crude for June delivery fell 94 cents to settle at $112.52 a barrel on the New York Mercantile Exchange, after trading as low as $110.30. Meanwhile, the euro bought $1.5457 in afternoon trading, down from $1.5642 late Wednesday.
Meanwhile, a strike that cut production at an Exxon Mobil Corp. facility in Nigeria ended Thursday, giving investors another reason to sell. Oil prices jumped last week on word of the strike and a separate labor action in Scotland, which ended Tuesday. Nigeria is a major U.S. oil supplier.
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Home Depot to close 15 underperforming US stores
ATLANTA (AP) -- It's been 4 1/2 years since former Home Depot Chief Executive Bob Nardelli's bold prediction that the home improvement retailer could sustain "unlimited growth" without significantly affecting sales at established stores.
That statement was made during much better economic times.
The Atlanta-based company, under different leadership, a different growth philosophy and amid an ailing housing market, put the brakes Thursday on some of its future expansion plans and said it would do what was previously unthinkable -- close 15 of its underperforming flagship stores.
It is the first time the world's largest home improvement store chain has ever closed a flagship store for performance reasons. The move, to be completed within the next two months, will affect 1,300 employees.
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Comcast 1Q profit falls, but Internet, phone lifts stock
PHILADELPHIA (AP) -- Promotional offers and higher cable television spending fueled the first-quarter profits of Comcast Corp., which showed limited effects from an economic slowdown.
The nation's largest cable operator posted a 12.5 percent decline in profits, but it was mainly due to one-time gains from the dissolution of cable partnerships. Excluding those gains, earnings actually rose by 9.5 percent.
Comcast also confirmed its financial outlook for 2008 despite economic headwinds.
Investors cheered the unexpected news, driving shares up 8.6 percent, or $1.76, to close at $22.31.
Comcast was able to deliver because of its diversified business, Moffett said. As consumers pinch pennies, for example, they might pull back on pay-per-view purchases but sign up for digital phone service with unlimited domestic calls at a set price.
By The Associated Press The Dow rose 189.87, or 1.48 percent, to 13,010.00, after briefly rising more than 200 points. It hadn't closed above 13,000 since Jan. 3, when it ended at 13,056.72; the Dow is still down 8.15 percent from its record close of 14,164.53, reached Oct. 9, 2007, before the brunt of the credit crisis hit Wall Street.
Broader stock indicators also enjoyed a significant advance Thursday. The Standard & Poor's 500 index rose 23.75, or 1.71 percent, to 1,409.34 -- its first settlement above 1,400 since Jan. 14. The Nasdaq composite index climbed 67.91, or 2.81 percent, to 2,480.71, its highest close since Jan. 10.
Light, sweet crude for June delivery fell 94 cents to settle at $112.52 a barrel on the New York Mercantile Exchange, after trading as low as $110.30.
In other Nymex trading Thursday, June heating gasoline futures fell 2.81 cents to settle at $2.8782 a gallon, and June heating oil futures fell 4.03 cents to settle at $3.1177 a gallon. June natural gas futures fell 28.2 cents to settle at $10.561 per 1,000 cubic feet. The Energy Department said natural gas inventories rose by 86 billion cubic feet last week, more than many analysts had expected.
In London, June Brent crude futures fell 86 cents to settle at $110.50 a barrel on the ICE Futures exchange.
