Markets flat Wednesday
NEW YORK, Aug. 29 (UPI) -- U.S. stock indexes managed only slight gains in New York Wednesday after the Commerce Department revised its GDP estimate from 1.5 percent to 1.7 percent.
Consumer spending increased more than previously reported, bumping the gross domestic product higher, but not as high as the first quarter increase of 2 percent over the fourth quarter of 2011.
By close of trading, the Dow Jones industrial average gained 4.49 points to 13,107.48, up 0.03 percent. The tech-heavy Nasdaq Composite index added 4.05 points to 3,081.19, up 0.13 percent. The Standard and Poor's 500 added 1.19 points to 1,410.49, up 0.08 percent.
On the New York Stock Exchange, 1,799 stocks advanced and 1,175 declined on a volume of 2.4 billion shares traded.
The benchmark 10-year treasury fell 5/32, yielding 1.655 percent.
The euro fell to $1.2531 from Tuesday's $1.2565. Against the yen, the dollar rose to 78.70 yen from 78.51 yen.
In Tokyo, the Nikkei 255 index added 0.4 percent, 36.52 points, to 9,069.81.
In London, the FTSE 100 index fell 0.56 percent, 32.18 points, to 5,743.53.
Democrats to revisit minimum wage issue
WASHINGTON, Aug. 29 (UPI) -- A minimum wage hike is expected to be part of the Democratic Party platform presented to delegates in North Carolina, a member of the drafting committee said.
"There will be mention of it in the platform this year, though not real detailed," The Hill newspaper quoted Thea Lee, deputy chief of staff for the AFL-CIO, as saying.
Lee was on the 15-member committee responsible for drafting the party platform, which will be presented to delegates at the national convention in Charlotte, N.C., Sept. 4-6, the newspaper said Wednesday.
"The platform is all about building a strong economy from the middle class out, and the minimum wage is a key part of that. It's clearly something that's overdue. It will be good for working people and the economy," Lee said.
Those in favor of a minimum wage increase point to the immediate effects it would have on the economy, given those making minimum wage tend to spend their money, including wage increases, fairly quickly, turning the wage hike into business growth.
Those opposing a minimum wage hike point to the burden it would have on small businesses, which tend to have very tight profit margins and would likely cut back on hiring if their costs increase.
Since the end of the recession, small businesses have done the lion's share of the hiring.
U.S. Chamber of Commerce executive director of labor law policy Marc Freedman called the minimum wage hike issue "a typical election year ploy by some to make it appear as though they're supporting low-income workers."
The federal minimum wage has been $7.25 per hour since July 2009.
In recent years, Democrats have made fleeting attempts to raise the minimum wage. It was on the party's platform during the last presidential election. Three separate bills written by Democrats, two in the House and one in the Senate, have addressed the issue, but none of these bills, written respectively by Rep. Jesse Jackson Jr., D-Ill., Rep. George Miller, D-Calif., and Sen. Tom Harkin, D-Iowa, have gotten much traction.
Republican presidential candidate Mitt Romney in January said he favored a minimum wage hike, but has since pulled back from that position due to whiplash among conservative constituents, the newspaper said.
Fed notes recovery remains mixed
WASHINGTON, Aug. 29 (UPI) -- The U.S. Federal Reserve said Wednesday the economic recovery was mixed across the country in July and early August.
The Fed's Beige Book report, an eight-times per year report named after the color of its cover, said six of the 12 Fed banking districts reported growth occurred at a "modest" pace, while growth proceeded at a "moderate" pace, in three other regions, including Chicago, where the increase was slower than in the previous reporting period.
In the final three districts, the Philadelphia and Richmond areas reported "slow growth in most sectors and declines in manufacturing," the Fed said.
In the final district, Boston, the economy was said to include "mixed reports from business contacts and some slowdown since the previous report."
On the positive side, "most districts" reported gains in the retail sector, although the gains were slight in the Cleveland, Chicago, St. Louis, Dallas and San Francisco areas.
In addition, Boston, New York, Richmond, Atlanta, Minneapolis and San Francisco reported solid growth in the tourism sector.
The pace of manufacturing was mixed. Around Boston, Chicago, Kansas City and San Francisco, demand and sales rose, "although the improvement was generally small and uneven."
Six other districts reported demand for manufactured goods declined.
Considering future business, firms in six federal districts indicated that manufacturers were expecting demand to increase.
Merkel, Monti, see ESM differently
BERLIN, Aug. 29 (UPI) -- German Chancellor Angela Merkel said she believed the European Stability Mechanism could not be granted a banking license that would allow it to issue bonds.
Italian Prime Minister Mario Monti and other leaders in Europe have said the bailout fund assembled by the European Commission to rescue countries burdened by high government debts could be used to issue bonds, which would give the ESM a great deal more leverage, The New York Times reported Wednesday.
But European Central Bank President Mario Draghi and now Merkel have said the ESM could not be treated as if it were a bank.
"The current design of the ESM does not allow it to be recognized as a suitable counter-party," Draghi said.
Merkel made reference to the Draghi's statement after meeting with Monti in Berlin Wednesday.
Merkel, however, did say that Italy had made "wide reaching" efforts to trim its high debt load.
"I am personally convinced that these reform efforts will bear fruit, that they will improve Europe's overall competitiveness," she said after two hours of talks with Monti.
Monti's visit comes soon after last week's meeting with Greek Prime Minister Antonis Samaras.
Merkel used that meeting to praise Greece's progress in bringing its debt burden under control.
Monti, in turn, thanked Germany for taking a leadership role in Europe's financial crisis. But he also suggested he would continue to press forward with the proposal that the ESM be treated as a bank.
"All of these issues must be viewed as a mosaic. All of these, the ESM, a banking license, are individual mosaic tiles that make up a complete picture," he said.
