UPI NewsTrack Business

Durable goods data drags down Dow

NEW YORK, July 28 (UPI) -- U.S. investors took a cue from the Commerce Department Wednesday, as markets fell in the wake of disappointing durable goods data.

Economists had predicted a gain of 1.1 percent for the manufacturing sector that has been one of the bright spots of the economic recovery. Instead, durable goods orders fell 1 percent in June, the department said.

By close, the Dow Jones industrial lost 39.81 points, 0.38 percent, to 10,497.88. The Standard & Poor's 500 index lost 7.71 or 0.69 percent, to 1,106.13. The Nasdaq composite index dropped 23.69 points, 1.04 percent, to 2,264.56.

Dow component Boeing took the biggest hit, dropping 1.3 percent. McDonald's Corp. shares fell 0.63 percent.

On the New York Stock Exchange, 994 stocks advanced and 2,013 declined on a volume of 4.7 billion shares traded.

The benchmark 10-year treasury note rose 17/32 to yield 2.989 percent.

The euro fell to $1.2994 from Tuesday's $1.3003. Against the yen, the dollar dropped to 87.45 yen from Tuesday's 87.96 yen.

In Japan, the Nikkei 225 index added 2.7 percent, 256.42, to 9,753.27.

In Britain, the FTSE 100 index lost 0.86 percent, 45.99, to 5,319.68.

Fed points to spotty and slowing gains

WASHINGTON, July 28 (UPI) -- The U.S. Federal Reserve said Wednesday economic activity is increasing, but growth in some districts is level or slowing down.

The federal banks in Cleveland and Kansas City, Mo., reported economic activity "held steady," the Fed said in its Beige Book report. Otherwise, "on balance" the economy was showing improvement.

Manufacturing, a bright spot in the economic recovery, "continued to expand in most districts," the Fed said.

There were spotty declines. The Federal Bank of Atlanta noted a decrease in tourism, especially in the Gulf Coast region, where the Deepwater Horizon oil spill had put a damper on summer visits. Auto sales were reportedly down in "most districts," the report said. Real estate activity became "sluggish" after an $8,000 federal tax credit for homebuyers ended at the end of April. The retail sector showed signs of increased consumer spending in "several" districts, including Dallas, New York, Philadelphia, Minneapolis, and Kansas City.

Perhaps ominously, growth in manufacturing has slowed, although auto production was up in Cleveland, Chicago and St. Louis.

Fuel demand rose around San Francisco and held steady around Dallas.

Remaining depressed, "commercial and industrial real estate markets continued to struggle in all twelve districts," the Fed said. In addition, the construction sector is showing few signs of improvement.

The Fed said the labor market improved in five districts -- New York, Chicago, Minneapolis, Atlanta and Richmond, Va. -- and held steady in Boston and Dallas. Several districts, however, reported employment was boosted by temporary hiring. San Francisco noted unemployment remained high and hiring "limited," the report said.

Arizona pushes power efficiency

PHOENIX, July 28 (UPI) -- Regulators in Arizona have set a goal of reducing electric power consumption in the state by 22 percent in 10 years in a push towards conservation.

The Arizona Corp. Commission voted 5-0 to force electric companies to promote conservation efforts through efficiency, The Arizona Republic reported Wednesday.

The new goals were supported by environmental groups and consumer advocates, including the Southwest Energy Efficiency Project, which projects a savings for consumers of $9 billion by 2020.

SEEP representative Jeff Schlegel said, "Utilities that under-invest in energy efficiency will deliver their customers the highest utility bills."

Utilities can employ a variety of strategies to pull down power use, including promotions of appliances and light bulbs that are energy-efficient or providing incentives for consumers to use less power during periods of peak demand.

Commission Chairwoman Kris Mayes said, "I personally think this is the most important thing I will ever do in my life. It is one of the most important decisions this commission has ever made in its 100-year history."

The rules include a mandate that utilities derive 15 percent of their power from renewable sources by 2025.

Power companies opposed the plan on expectation that revenues will drop, the newspaper said.

Lending in Europe trending back to normal

BRUSSELS, July 28 (UPI) -- The European Central Bank said demand for loans rose from both consumers and businesses in the second quarter in the 16 nations that use the euro as currency.

In a survey of 120 banks in the eurozone, lenders indicating demand for loans was up rose from minus 13 percent in the first quarter to minus 2 percent in the second, while lenders indicating loan demand from consumers -- mostly for mortgages -- jumped from minus 2 percent to 24 percent, The Financial Times reported Wednesday.

Deutsche Bank economist Gilles Moec said a trend towards normal lending would continue in the next six months, but "not spectacularly, because the situation is still stressed."

While demand is rising, a survey by Ifo in Germany found complaints from businesses concerning the difficulty of obtaining loans had dropped from 34 percent in June to 31.6 percent in July.