U Capital One Financial Corp., the McLean credit-card company that set aside $1.9 billion in the fourth quarter for loan losses, said it will eliminate 750 jobs in Great Britain by year’s end. The cuts are part of a plan, announced in June, to trim 2,000 jobs across the company. The British division will outsource more work.
U Circuit City Stores Inc. investor Mark Wattles said he will meet Friday with the money-losing electronics retailer’s lead director, Mikael Salovaara. Mr. Wattles, who owns 6.5 percent of the Richmond-based retailer, is seeking to replace Chief Executive Officer Philip Schoonover and the board, arguing that management’s strategy isn’t working.
U Fannie Mae and Freddie Mac shares will tumble to $16 or less, Goldman Sachs said, forecasting that credit losses will “increase rapidly.” At Lehman Brothers, analysts said the companies have turned a corner and predict the shares will soar to $45 or more. Fannie Mae will have $15.2 billion in additional credit losses through 2010, Goldman said, and Freddie Mac will have $10.6 billion.
U Officials at the Pentagon and Bethesda’s Lockheed Martin Corp. said that they expect cost overruns on the military’s newest fighter jet to level off. Less than a month after congressional auditors forecast ballooning costs for the Joint Strike Fighter, the Defense Department predicted the cost of the Lockheed-led contract would be $298.8 billion, down $1 billion from a year ago estimate.
U American Airlines was to cancel up to 500 of yesterday’s flights, perhaps one-fifth of its schedule, to check the bundling of wires in some planes, the same issue that caused the airline to scrap more than 400 flights last month. American, the nation’s largest carrier, said the cancellations could spill into today and beyond.
U About 62 deaths are now associated with contaminated batches of the blood thinner heparin, triple the previous estimate, the Food and Drug Administration said. That doesn’t mean people are still dying. The latest deaths of which the FDA is aware occurred in February, the month Baxter International recalled contaminated batches.
U The Food and Drug Administration issued a warning to GlaxoSmithKline for not reporting safety results on its diabetes pill Avandia, which received a prominent warning label last year. The FDA said that between 2001 and 2007, the drug maker did not annually update the agency on more than 10 ongoing studies of Avandia, as required by regulations.
U MGIC Investment Corp., the largest U.S. mortgage insurer, had the claims-paying ratings of its mortgage insurance subsidiaries cut to A from AA- by Standard & Poor’s. Most mortgage insurers “will not generate an underwriting profit until 2010,” the ratings company said.
U Morgan Stanley Chief Executive Officer John Mack said the credit crisis will last “a couple of quarters” longer as it spreads to commercial real estate, subprime mortgages in Europe and U.S. midsized banks. The collapse of the subprime market in the United States has reached its eighth inning or “maybe top of the ninth,” Mr. Mack said before the company’s annual meeting.
U Federal Reserve Governor Randall Kroszner met with credit-card issuers, consumer groups and regulators to discuss rules the central bank is developing to improve disclosures and consumer protections for cardholders. “The information shared will guide the Federal Reserve’s work to ensure that … credit-card users are protected from unfair and deceptive practices,” Mr. Kroszner said.
U Amazon.com Inc., the world’s biggest Internet retailer, plans to hire more than 500 full-time employees for three distribution centers in Kentucky to meet rising demand as more people shop online. Amazon.com is looking for people to fill management, human resource, maintenance and shipping and receiving positions at the centers in Hebron, Ky., Amazon said.
U Google Inc. started a service that lets outside developers of Web software store their programs on its computers free of charge, seeking to match similar offerings from rivals such as Amazon.com Inc. The trial service, begun Monday, reached its limit of 10,000 developers yesterday, Google said. Each application will get a restricted amount of storage on Google’s servers.
U UPS, the world’s largest package-delivery company, reduced its first-quarter earnings estimate because of slowing domestic shipments as the U.S. economy cools. Earnings per share will be 86 cents to 87 cents a share, from a previous range of 94 cents to 98 cents, the Atlanta-based company said in a statement on Business Wire.
U An insurance company isn’t obligated to pay for water damage from the failure of New Orleans area levees after Hurricane Katrina, Louisiana’s highest court ruled in a case that could affect thousands of homeowners. In a major victory for insurers and a reversal of a lower-court ruling, the Louisiana Supreme Court said Lafayette Insurance Co. is entitled to limit its liability for damage from a levee breach.
U Restructuring plans at General Motors, Ford and Chrysler may be imperiled as declining U.S. sales and tighter credit markets drain cash, Standard & Poor’s said. The credit rating agency said the automakers “will continue to burn cash in 2008 and possibly 2009 if the economy remains weak; perhaps necessitating further costly restructurings.”
U U.S.auto sales will fall to 14.9 million this year, the lowest since 1995, as rising fuel costs and tighter lending policies erode demand, Standard & Poor’s chief economist David Wyss said. Sales of cars and light trucks totaled 16.1 million last year, the lowest in a decade. S&P; joined J.D. Power & Associates in forecasting sales will tumble below 15 million this year.
U Three former leaders of the Securities and Exchange Commission say a proposed overhaul of financial regulation threatens to weaken the agency. David Ruder, Arthur Levitt and William Donaldson said an administration push to adopt a more collaborative, rather than punitive, regulatory approach such as that of the Commodities Futures Trading Commission would be a mistake.
U JPMorgan Chase & Co., the third-largest U.S. bank, completed a share exchange that moves it closer to completing the acquisition of Bear Stearns Cos. JPMorgan purchased 95 million newly issued shares of Bear Stearns common stock, or 39.5 percent of the shares outstanding, in exchange for about 20.7 million shares of the bank’s stock.
U BP PLC, which operates the Alaskan pipeline shipping oil to the lower U.S., is joining ConocoPhillips in plans to build a similar natural-gas network. The line would ship 4 billion cubic feet of natural gas a day 700 miles to Alberta, with an extension into the United States “should it be required,” the companies said.
U Congress should repeal a provision that may block government fuel purchases from Alberta’s oil sands, said Sen. Pete V. Domenici of New Mexico, senior Republican on the Senate Energy and Natural Resources Committee. The provision bars the United States from buying alternative fuels if the production creates more greenhouse gases than conventional fuels.
U Internet search giant Google Inc. introduced a feature for its popular mapping programs that shines a spotlight on the movement of refugees around the world. The maps will aid humanitarian operations as well as help inform the public about the millions who have fled their homes because of violence or hardship, according to the office of the U.N. High Commissioner for Refugees.
U ONGC Videsh Ltd., the overseas arm of India’s Oil & Natural Gas Corp., created a joint venture with Venezuela’s state oil company to pump 232 million barrels of crude over 25 years. Petrolera IndoVenezolana SA, the new venture, will boost the San Cristobal field’s output to 40,000 barrels from 20,000 a day, ONGC said.
From wire dispatches and staff reports