Markets ahead at the close
NEW YORK, Feb. 26 (UPI) -- U.S. stock indexes rebounded Tuesday, making gains despite drops in equity markets in Asia and Europe.
Analysts have said markets are overdue for a downward correction but stocks found support from two home price reports released Tuesday that indicated the housing market finished 2012 with strong gains.
The Federal Housing Finance Agency said home prices rose 1.4 percent in the fourth quarter over the third quarter. The S&P/Case-Shilling home price report said its national composite index posted a gain of 7.3 percent on the year.
By close of trading, stocks had regained about half of Monday's rout.
The Dow Jones industrial average added 115.96 points or 0.84 percent to 13,900.13. The Standard and Poor's 500 added 9.09 points or 0.61 percent to 1,496.94. The Nasdaq composite added 13.40 points or 0.43 percent to 3,129.65.
On the New York Stock Exchange, 2,030 stocks advanced and 1,003 declined on a volume of 3.9 billion shares traded.
The 10-year U.S. treasury fell 5/32 to yield 1.885 percent.
Against the dollar the euro fell to $1.3058 from Monday's $1.3062. Against the yen, the dollar was higher at 91.98 yen from 91.82 yen.
In Tokyo, the Nikkei 225 closed at 11,398.81 points, down 263.71 points or 2.26 percent.
In London, the FTSE 100 index shed 1.34 percent, 84.93 points, to 6,270.44.
Bernanke unflappable over policy
The Fed announced in December it would maintain its historically low federal fund rate in place until the unemployment rate dropped to 6.5 percent. It is currently at 7.9 percent.
The Fed also said it would continue with asset purchases at the rate of $85 billion per month until the employment situation improved.
The caveat was that both policies were subject to change if inflation drifted much higher than the central bank's target rate of 2 percent per year.
But investors were dismayed last week to read in meeting minutes for the Fed's late January Open Market Committee meeting policymakers were divided on the asset purchasing program.
That put the stock market in a tailspin, pulling the Dow Jones industrial average off a five-year peak.
But Bernanke did not mention any division among committee members in prepared comments for a semiannual policy report before the Senate Committee on Banking, Housing and Urban Affairs.
"The [Federal Open Market] Committee remains confident that it has the tools necessary to tighten monetary policy when the time comes to do so," Bernanke said.
He also said inflation "is currently subdued, and inflation expectations appear well anchored."
"The FOMC has indicated that it will continue purchases until it observes a substantial improvement in the outlook for the labor market in a context of price stability," he told panel members.
"Monetary policies may increase certain types of risk-taking, in the present circumstances they also serve in some ways to reduce risk in the system, most importantly by strengthening the overall economy."
Bernanke also noted that pulling back on asset purchases as the recovery became more solid would affect the federal budget.
Due to its $3 trillion portfolio, "remittances have roughly tripled in recent years, with payments to the Treasury totaling approximately $290 billion between 2009 and 2012," Bernanke said.
A stronger economy would mean less need for interest rate lowering purchases. In turn, "these remittances would likely decline in coming years," he said.
GM says it did not request CEO raise
DETROIT, Feb. 26 (UPI) -- U.S. automaker General Motors denied it had asked the government for a 20 percent raise for Chief Executive Officer Dan Akerson.
"Reports that General Motors has requested an increase in Dan Akerson's 2013 compensation are false. In fact, Dan specifically asked to keep his compensation at the same level for 2013 as it was in 2012 and 2011. That amount of $9 million is what the company submitted to the Office of the Special Master for TARP Executive Compensation," GM said in a statement.
However, The Detroit News reported Tuesday the company had requested Akerson be given $11.1 million in 2013. And an official at GM said the CEO would be given, on paper, $11.1 million for 2012, because of $2 million in pay in the form of restricted stock that actually applies to his work from 2011.
"Unfortunately, someone who obviously did not understand the compensation request leaked the information in a way that misrepresented the truth in order to score political points on the eve of a congressional hearing," GM said.
As recipient of $49.5 billion in bailout funds, GM must submit pay requests for its top 25 executives to the Treasury Department for approval.
Christy Romero, inspector general for the Troubled Asset Relief Program, said in January the pay packages at GM were too high, the Detroit Free Press reported.
In a statement prepared for Congress, Romero said the Treasury Department failed to reign in high salaries, even though former Treasury Secretary Timothy Geithner said high executive salaries encouraged risk taking that contributed to the financial crisis.
"While taxpayers struggle to overcome the recent financial crisis and look to the U.S. government to put a lid on compensation for executives of firms whose missteps nearly crippled the U.S. financial system, Treasury continues to allow excessive executive pay," Romero said.
World's tallest hotel opens in Dubai
DUBAI, United Arab Emirates, Feb. 26 (UPI) -- JW Marriott has opened the doors to what it calls the tallest hotel in the world, the JW Marriott Marquis Dubai in the United Arab Emirates.
At 355 meters or 1,164 feet from sidewalk to rooftop, the 77-story hotel has been certified as the tallest crash pad in the world by the Guinness Book of World Records, Gulf News reported Tuesday.
The building is 26 meters shorter than the Empire State Building in New York City, which is 1,250 feet tall.
"Dubai is an important destination for Marriott International as one of the world's most exciting cities offering world-class facilities and infrastructure, central location in the region and future growth potential," said Marriott International President and Chief Executive Officer Arne Sorenson, who was in Dubai for the grand opening for the first JW Marriott Marquis that is not in North America.
The new hotel is the company's 59th Marriott Marquis brand of luxury hotels.
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