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U.S. markets mixed Thursday

NEW YORK, June 18 (UPI) -- U.S. markets were mixed Thursday after the Labor Department said initial jobless claims continued at a pace above 600,000 last week.

First-time claims for unemployment benefits rose by 3,000 above the previous week. Investors are also considering a raft of regulatory reforms for financial firms proposed Wednesday by the Obama administration.

In late morning trading, the Dow Jones industrial average gained 51.70 points, or 0.61 percent, to 8,548.88. The Standard & Poor's 500 rose 0.58 percent, 5.31 points, to 916.02. The Nasdaq composite index fell 6.05 points, 0.33 percent, to 1,802.01.

The benchmark 10-year U.S. Treasury bond fell 10/32 to yield 3.725 percent.

The euro rose to $1.3962, compared to Wednesday's $1.3953. Against the Japanese yen, the dollar rose to 95.77 yen, compared to Wednesday's 95.64 yen.

In Tokyo, the Nikkei average lost 137.13 points to 9,703.72 , off 1.39 percent.

Geithner pushes regulatory reform plan

WASHINGTON, June 18 (UPI) -- U.S. Treasury Secretary Timothy Geithner said a stronger regulatory system was needed to prevent an accumulation of financial risk in a modern market place.

Government supervision "didn't prevent the emergence of large concentrations of risk," Geithner told members of the Senate Banking Committee Thursday. "New financial institutions and instruments … were almost entirely outside the government's supervisory framework, (leaving) regulators largely blind to emerging dangers," he said.

"Our core challenge is to design a system that has a proper balance between innovation and efficiency on the one hand, and stability and protection on the other," he said.

Defending the Obama administration's proposal to form a Financial Services Oversight Council with powers that reach beyond financial firms, "none (of the current regulators) was assigned to look out for the system as a whole," he said.

Advocating for formation of a Consumer Financial Protection Agency, Geithner said none of the existing regulators viewed consumers "as their primary charge."

Banks, on the other hand, required lager capital reserves to protect themselves during a downturn because "no one should assume that the government will step in to bail them out if their firm fails," Geithner told committee members.

He pressed for legislatures to act while before the political will for meaningful reform subsides.

Dairy farmers tie up traffic in Brussels

BRUSSELS, June 18 (UPI) -- Dairy farmers in Belgium rode tractors into the European Union capital Thursday, tying up Brussels traffic to protest falling milk prices.

The EU Observer said between 500 and 1,000 tractors held up traffic as they headed toward the Parc de Cinquantenaire. Traffic delays were reported on several roads, as farmers rode three abreast into the city, the report said.

Police met the protesters with barricades and parked armored vehicles. A summit of EU leaders is scheduled in Brussels starting at 5 p.m.

The demonstration has government approval so long as the farmers stay at least 300 feet from the meeting.

"We demand that the heads of state and government put the catastrophic situation of the milk market at the top of their priorities," said Romuald Schaber, head of the European Milk Board.

Farmers have been protesting a 30 percent drop in milk prices that have occurred while store prices have remained stable.

In addition, farmers want milk production quotas reinstated. The EU plans to phase out milk quotas through 2015, the EU Observer reported previously.

An EU official said the protest would probably not affect the meeting, which follows an agenda set six weeks in advance.

Chinese media reports sale of Ford's Volvo

BEIJING, June 18 (UPI) -- Geely Automobile Holdings in China has agreed to a tentative deal to purchase Volvo Cars from Ford Motor Co., the China Daily reported Thursday.

The paper cited other media reports which include Geely's plans to produce a new Volvo in the Guangzhou Province.

The Local, a Swedish newspaper in Stockholm, reported that Geely intended to build the XC90 in China and position the company for a move toward a global market.

A Volvo spokeswoman Maria Bohlin told the Swedish news agency Tidningarnas Telegrambyra that, "Ford is in charge of the sale. We don't know anything here."

Ford bought Volvo for $6.9 billion, but will likely sell the company for about $3 billion, the China Daily said.

"It's the right time for Chinese firms to make overseas acquisition during the slowdown in the economy," said Jia Xinguang, an analyst with the Chinese National Automotive Industry Consulting and Development Corp.

Chinese industrial equipment producer Sichuan Tengzhong Heavy Industrial Machinery Co. recently agreed to purchase the Hummer brand from General Motors Corp.