Market closes mixed on heels of Fed rate cut

The increase surprised many economists who had expected a decline. Orders had fallen by 5.5 percent in August, which was the biggest setback in nearly two years.

The big increase in orders for motor vehicles probably reflected the use of incentive packages by automakers trying to spur lagging demand during a generally dismal sales year. Orders for motor vehicles and parts had fallen by a sharp 8.8 percent in August.

In Detroit, a possible General Motors Corp. takeover of Chrysler LLC would cost 25,000 to 35,000 jobs at the automakers, according to a Michigan consulting firm.

But the Anderson Economic Group of East Lansing said Wednesday the alternative of Chrysler being sold in pieces would result in many more job losses, the Associated Press (AP) reported.

A GM acquisition, with possible help from the federal government, is a likely possibility, Patrick Anderson, the firm’s CEO, said in a conference call with reporters.

“It’s a much bigger job loss and a much bigger taxpayer hit if Chrysler simply goes out of business or is dismantled,” Anderson said.

Chrysler employs about 49,000 people in the U.S. and has about 125,000 retirees and spouses.

In other automotive news, Porsche moved Wednesday to put stem volatility in Volkswagen shares by selling some options and Germany’s financial regulator announced a formal investigation into Volkswagen’s recent stratospheric stock gains, AP reported.

Porsche said it would be selling up to 5 percent of its options for common shares in the automaker causing Volkswagen’s stock to slump drastically Wednesday after several days of eye-popping gains, AP said.

The shares plunged 39.5 percent to 572 euros ($737.88) in late afternoon Frankfurt trading.

The options move comes after a weekend announcement that Porsche had bought options to increase its ownership in Volkswagen to 75 percent, building upon its previous ownership of 42.6 percent in common stock.