Business Highlights

467K jobs cut in June; jobless rate at 9.5 percent

WASHINGTON (AP) — Employers cut a larger-than-expected 467,000 jobs in June and the unemployment rate climbed to a 26-year high of 9.5 percent. Workers also saw weekly wages fall, suggesting Americans will have little appetite to spend and the economy's road to recovery will be bumpy.

The Labor Department report, released Thursday, showed that even as the recession flashes signs of easing, companies likely will want to keep a lid on costs and be wary of hiring until they feel certain the economy is on solid ground.

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Jobless data sends stocks reeling; Dow loses 223

NEW YORK (AP) — Major stock indexes fell more than 2.6 percent after the government said the U.S. unemployment rate hit a 26-year high. The Dow Jones industrials lost 223.32 to close at 8,280.74, their lowest level in six weeks.

Trading on the New York Stock Exchange was extended until 4:15 p.m. Eastern time in order to execute customer orders impacted by system irregularities, an NYSE spokeswoman said.

As investors sold off stocks amid fresh concerns about the economy, they moved into the safety of bonds, pushing Treasury yields lower.

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Johnson & Johnson pays $1B for Elan stake

TRENTON, N.J. (AP) — Johnson & Johnson, making a big jump into the risky but potentially lucrative field of Alzheimer's disease, is taking a major stake in Irish biopharmaceutical company Elan Corp., investing up to $1.5 billion initially.

The two will cooperate to complete research on two injected drugs to stop progression of the mind-robbing disease and on a vaccine to prevent the buildup of plaque in the brain that causes increasing memory loss, confusion, wandering and aggression.

The agreement could reinvigorate ailing Elan and save the jobs of top executives who face shareholders at their July 17 annual meeting. It would make J&J a major player in one of the biggest areas of unmet medical need and — if further testing is successful — bring the treatments to market faster.

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Feds seize Madoff penthouse, wife leaves

NEW YORK (AP) — Federal marshals took possession of disgraced financier Bernard Madoff's $7 million Manhattan penthouse on Thursday in a move that forced his wife to move elsewhere.

Proceeds from a sale of the property and its contents could be used to help reimburse those who lost billions of dollars investing with Madoff before he confessed to running a Ponzi scheme.

U.S. Marshal Joseph Guccione said the marshals arrived at the property at noon with a court order permitting them to take custody of the apartment and to make anyone living there move out.

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2 more banks fail as FDIC seeks stronger rules for sale of failed banks

WASHINGTON (AP) — Two Illinois banks were shuttered Thursday as government regulators proposed new rules for private equity firms seeking to take over failed banks.

Regulators shut down John Warner Bank of Clinton, Ill., and First State Bank of Winchester in Winchester, Ill., bringing to 47 the number of U.S. bank failures this year.

Private equity firms seeking to buy failed banks, meanwhile, would face strict capitalization and disclosure requirements under government rules proposed Thursday that some regulators already warn may go too far.

The Federal Deposit Insurance Corp. is seeking to expand the number of potential buyers for the growing number of banks it has closed during the financial crisis. With mounting interest from private equity firms, whose methods and motives aren't always clear, the FDIC is trying to set requirements to ensure the banks won't fail again.

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Boeing maintains deliveries in 2nd-quarter

WASHINGTON (AP) — Boeing Co. delivered 125 commercial jets in the second quarter, one less than the same period in 2008.

The aerospace manufacturer said for the three month-period it delivered 99 of its 737s — the company's best-selling jet — and 21 777s. In the same period last year, Boeing delivered 100 737s and 18 777s.

Other deliveries included two 747s and three 767s, according to figures posted Thursday on Boeing's Web site. To date this year, Boeing has delivered 246 planes up from the 241 planes in the period of 2008.

Boeing has struggled with slumping orders for its jets as the recessions dampens demand for air travel and cargo services.

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Factory orders rise more than expected in May

WASHINGTON (AP) — Orders to U.S. factories jumped in May by the largest amount in nearly a year, another sign that the nosedive in manufacturing is nearing an end.

The Commerce Department said Thursday that total orders rose 1.2 percent in May, better than the 0.8 percent increase that economists had expected. The April performance was revised slightly lower to a gain of 0.5 percent, from 0.7 percent.

The May increase was the best showing since a 2.1 percent rise last June. The back-to-back increases in April and May were the first consecutive gains in nearly a year.

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Oil prices tumble as Europe and the US shed jobs

NEW YORK (AP) — Oil prices tumbled to their lowest level in a month Thursday following the release of woeful job numbers in Europe and the U.S.

Benchmark crude for August delivery fell $2.58, nearly 4 percent, to settle at $66.73 a barrel on the New York Mercantile Exchange.

Crude hit an eight-month high in midday trading Tuesday, but prices have fallen at the close for five straight days now.

Nymex is closed Friday for the July Fourth holiday.

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ECB keeps interest rate at 1 pct

LUXEMBOURG (AP) — The European Central Bank left its benchmark interest rate unchanged at 1 percent Thursday, preferring to wait and see if its "spectacular" infusion of credit into the banking system will loosen lending to consumers and businesses in the euro zone's struggling economy.

Bank President Jean-Claude Trichet said the ECB was pleased by the demand for its record euro442 billion ($623 billion) in 12-month credits to banks last week, but wouldn't comment about what more it might do. The new loan program comes on top of cutting the bank's main interest rate from 4.25 percent to 1 percent since October.

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GM urges quick approval of sale plan

NEW YORK (AP) — An attorney for a trio of bondholders opposed to General Motors' sale plan on Thursday urged a judge to call the government's bluff and require the automaker to restructure itself through a more traditional Chapter 11 process instead of through the quick sale of its assets.

Michael Richman said in his closing statement that it's doubtful that the government would actually make good on its threat to cut off funding to the automaker if the sale doesn't go through by its July 10 deadline. While GM may be powerless to fight the government's demands, the court can "push back" to protect the interests of all the company's stakeholders, he said.

By The Associated Press

The Dow Jones industrials lost 223.32, or 2.6 percent, to 8,280.74.

The Standard & Poor's 500 index fell 26.91, or 2.9 percent, to 896.42 and the Nasdaq composite index fell 49.20, or 2.7 percent, to 1,796.52.

Benchmark crude for August delivery fell $2.58, nearly 4 percent, to settle at $66.73 a barrel on the New York Mercantile Exchange.

In other Nymex trading, gasoline for August delivery fell 6.82 cents to settle at $1.7908 a gallon and heating oil lost 6.41 cents to settle at $1.7016 a gallon. Natural gas for August delivery dropped 18 cents to settle at $3.615 per 1,000 cubic feet.

In London, Brent prices dropped $2.14 to settle at $66.66 a barrel on the ICE Futures exchange.

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