UPI NewsTrack Business

U.S. stocks rally Tuesday

NEW YORK, Dec. 30 (UPI) -- U.S. markets rose Tuesday after the Treasury said it would supply $6 billion for struggling automotive financial firm GMAC.

Seen as critical for General Motors Corp., the Treasury said late Monday it had already closed on a $5 billion equity purchasing plan and would loan General Motors $1 billion to invest in GMAC.

On a day void of major financial reports, the Dow Jones industrial average closed up 184.46 points, or 2.17 percent, to 8,668.39. The Standard & Poor's 500 gained 2.44 percent, 21.22 points, to 890.64. The Nasdaq composite index rose 2.67 percent, 40.38 points, to 1,550.70.

On the New York Stock Exchange, 1,548 stocks advanced and 591 declined on a volume of 3.5 billion shares traded.

The benchmark 10-year U.S. Treasury bond rose 10/32 to yield 2.082 percent.

The euro rose to $1.4074 compared to Monday's $1.3971. Against the Japanese yen, the dollar fell to 90.27 yen from Monday's. 90.61 yen.

In Tokyo, the Nikkei average gained 112.39 points to 8,859.56, up 1.28 percent.

In London, the FTSE 100 index gained 73.33 points, 1.7 percent, to 4,392.68.

Gazprom warns Europe of delivery problem

KIEV, Ukraine, Dec. 30 (UPI) -- A billing dispute between Russia's natural gas giant Gazprom and the Ukraine government could turn into a winter delivery problem for Europe, the company said.

"Gazprom is doing everything possible to avoid any disruption of gas deliveries to Europe," Gazprom deputy chairman Alexei Miller wrote in a letter to European clients recently, the EU Observer reported Tuesday.

"However, if events develop along an unfavorable scenario, the problem of Ukrainian transit will be a common problem for Russia and Europe," Miller wrote.

Gazprom says Kiev's gas bill has reached $2 billion, but Russian Prime Minister Vladimir Putin said Monday he spoke with Ukrainian President Viktor Yushchenko for an hour. After the call, he told reporters, "they don't want to pay," the EU Observer said.

European clients fear the incident will become a replay of a 2006 dispute in which Russia cut natural gas supplies over a billing disagreement.

The company has said it would continue making European deliveries regardless of its position with Ukraine and Ukraine has promised not to redirect supplies from pipelines that travel through the country, the Observer said.

Slovakia poised to join Eurozone

BRATISLAVA, Slovakia, Dec. 30 (UPI) -- The first Central European state to adopt the euro, Slovakia, is poised to officially join the Eurozone on Jan. 1, officials said.

Some officials called Slovakia's road to compliance with Eurozone directives as "bumpy," the EU Observer reported Tuesday.

Slovakia's ambassador to the European Union, Maros Sefcovic, said the country -- which will be the poorest member of the Eurozone -- had to work "at least twice as hard" as other Eurozone states to convince member states it was ready to join.

Once a concern, Slovakia has managed to keep its inflation rate under the mandated threshold in spite of its high economic growth rate compared to other EU countries.

Slovakia, third largest automaker in central Europe, will now be challenged to manage its manufacturing sector, its banking system and its economy, Daniel Gros, director of the Center for European Policy Studies said.

"The Slovak economy should be flexible and dynamic, its budgetary policy sustainable and its labor market adjustments should take place smoothly -- if these conditions are met, all the benefits of the euro will be higher," said EU Commissioner Joaquin Almunia.

Honey importing becomes 'nasty'

SEATTLE, Dec. 31 (UPI) -- The seemingly simple business of importing honey has become so rife with international intrigue that one U.S. broker said he was leaving the business.

"It's become so difficult in terms of risk to rewards … I don't want to take the chance anymore," said Rainier Cascade, Wash., honey broker Bob Coyle, a member of the National Honey Board.

The import business is plagued with a "transshipping," a practice of shipping honey to a benign port and re-labeling its origin to avoid testing or tariffs, the Seattle Post-Intelligencer reported Tuesday.

The Commerce Department imposed a duty of $1.20 a pound on Chinese honey eight years ago, after the county was judged to be dumping the product at less than market value. Chinese honey has also been found tainted with an antibiotic, chloramphenicol, which can be deadly to humans in rare cases.

Investigators from departments as diverse as Homeland Security, Immigration and Customs and the Food and Drug Administration have become involved in the issue, the newspaper said.

"There's more crooks than ever, and it has become a real nasty business," said Elise Gagnon, president of Odem International, a Canadian honey importer.