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March 11, 2013 at 7:09 PM   |   Comments

Markets post gains Monday

NEW YORK, March 11 (UPI) -- U.S. markets rose after a slow start Monday, beginning another week of record Dow Jones industrial average closing highs.

The index wobbled out of the gate Monday following record closing highs set Tuesday, Wednesday, Thursday and Friday. Investors apparently shrugged off fears of the sequester, the $85 billion in automatic spending cuts spelled out in the Budget Control Act of 2011.

The spending cuts became law March 1. Since then, the DJIA has added 324.58 points or 2.3 percent.

By close of trading trading Monday, the Dow Jones industrial average had another record closing high notched on its belt.

The blue chip index added 50.22 points or 0.35 percent to 14,447.29.

The Standard and Poor's 500 index gained 5.04 points or 0.32 percent to 1,556.22. The Nasdaq composite added 8.50 points or 0.26 percent to 3,252.87.

On the New York Stock Exchange, 1,635 stocks advanced and 1,397 declined on a volume of 2.9 billion shares traded.

The 10-year U.S. treasury bonds were off 5/32, yielding 2.064 percent.

Against the dollar, the euro rose to $1.3043 from Friday's $1.2986. Against the yen, the dollar was higher at 96.28 yen from 95.98 yen.

In Tokyo, the Nikkei 225 rose 0.53 percent on a gain of 65.43 points, to 12,349.05.

In London, the FTSE 100 index added 0.31 percent, 20.05 points, to 6,503.63.


FDIC reaching settlements on the QT

WASHINGTON, March 11 (UPI) -- Settlements made with a U.S. banking regulator over alleged wrongdoing have been handled with a new avoid-publicity clause, released agreements show.

The Los Angeles Times reported Monday that the Federal Deposit Insurance Corp. has been using a "no press release" option that has helped secure settlements over allegations of behavior that may have contributed to a bank's failure.

When IndyMac Bank, for example, failed in 2008, it cost the FDIC $13 billion to cover its losses. That was the largest FDIC bailout in its history, the Times said.

In the aftermath, the FDIC pursued the world's largest bank, Deutsche Bank, for selling IndyMac a pile of risky mortgages through a subsidiary, MortgageIT, which contributed to IndyMac's downfall.

The FDIC, collected $54 million from Deutsche Bank, settling out of court. This assures Deutsche Bank of not having to admit wrongdoing. It assures the bank of smaller legal fees and avoids a huge settlement that might result from a trial.

But the Times said the settlement included something new: A "no press release" clause in which the FDIC agreed not to publicize the settlement unless specifically asked about it.

"In the old days, the regulators made it a point to embarrass everyone, to call attention to their role in bank failures," former bank examiner Richard Newsom told the Times.

Newsom said the new policy was perhaps a step in which the FDIC also avoids publicity, given the agency did not want the public to know "how little they are setting for."

"Transparency is always better, and serves as a deterrent to future misconduct," said Lauren Saunders, managing attorney at the National Consumer Law Center in Washington.

In a hearing in Washington last week, Sen. Elizabeth Warren, D-Mass., pointedly expressed her disappointment with regulators who repeatedly failed to take bankers to trial and demand jail sentences for those who are guilty.


Icahn signs confidentiality pact with Dell

ROUND ROCK, Texas, March 11 (UPI) -- Activist investor Carl Icahn said he had agreed to a confidentiality agreement with U.S. computer maker Dell, which allows him to review the books.

Last week, Icahn wrote in a letter to Dell's board of directors, saying he was a "substantial" stakeholder and opposed the $24.4 billion deal from company founder Michael Dell to take the company private.

Icahn proposed selling debt to pay shareholders a dividend of $9 per share. If the board did not agree to that, he suggested shareholders be allowed to decide the issue with a vote at the company's next annual meeting, The Wall Street Journal reported.

Icahn also suggested he work with the board, which resulted in his signing a confidential agreement, the Journal said.

The investment firm Blackstone Group is also reviewing Dell's books. In both cases, it is possible an offer could be made to best Dell's proposed bid, which amounts to a $13.65 per share valuation of the company, which is struggling to adapt to the consumer trend of moving away from personal computers in favor of mobile devices.

Dell's board has set up a special committee to solicit bids that would have higher value to shareholders. When it released Icahn's letter last week, the board said it welcomes "Icahn and all other interested parties to participate in that process."


Boeing close to go-ahead on 777 upgrade

CHICAGO, March 11 (UPI) -- Boeing spokesman Marc Birtel said talk around the company consistently focuses on 2019 or before to launch the upgraded 777 jet.

The company has yet to officially kick off its upgrade program. But it has shopped the designs for the upgrades to Emirates Airline, International Consolidated Airlines Group and Japan Airlines in search of a "launch customer" for the new 777, which is currently being called the 777X, The Wall Street Journal reported Monday.

Birtel said "around the end of the decade," was "consistently talked about," as a launch date for the 777X.

Tim Clark, chief executive officer at Emirates Airline, said last week Boeing was close to the point where it could take orders for the new jet.

A spokesman at JAL said the airline was mulling over the possibility of signing on as a launch customer, which is a pre-production order large enough to guarantee a company will go ahead with an expensive project.

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