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March 21, 2013 at 5:43 PM   |   Comments

Markets down: Oracle report, Cyprus doubts

NEW YORK, March 21 (UPI) -- U.S. markets stumbled Thursday with the bailout for Cyprus undecided and a dour report from technology giant Oracle Corp.

Technology stocks turned lower after Oracle said sales were in decline. Markets are also under pressure due to uncertainty over an international bailout for Cypriot banks.

The European Central Bank, the International Monetary Fund and the European Commission -- the so-called troika -- have given Cyprus until Monday to come up with a viable deal to secure a $13 billion loan. The Cypriot parliament rejected the first proposal, which included a tax on bank deposits in Cyprus.

The government in Cyprus is working out plans to nationalize the pension funds of state-run companies and holding an emergency bond auction, The New York Times reported.

By close of trading, the Dow Jones industrial average lost 90.24 points, or 0.62 percent, to 14,421.49.

The Nasdaq shed 31.59 points, or 0.97 percent, to 3,222.60. The Standard and Poor's 500 dropped 12.91 points, or 0.83 percent, to 1,545.80.

On the New York Stock Exchange, 1,054 stocks advanced and 1,988 declined on a volume of 3.2 billion shares traded.

Ten-year U.S. treasury bonds rose 13/32 to yield 1.917 percent.

Against the dollar, the euro was at $1.2895 from Wednesday's $1.2936. Against the yen, the dollar was lower at 94.92 yen from 96.01 yen.

In Tokyo, the Nikkei 225 index gained 1.34 percent, 167.46 points, to 12,635.69.

In London, the FTSE 100 index lost 0.69 percent, 44.15 points, to 6,388.55.


Cyprus faces bailout deadline

NICOSIA, Cyprus, March 21 (UPI) -- The European Central Bank says Cyprus has until Monday to figure out how to raise $7.5 billion to secure an international bailout.

If Cyprus can't agree on a viable program for raising the funds, the ECB says it will cut off access to funding it provides Cypriot banks, The New York Times reported Thursday.

The ultimatum has darkened the mood in Cyprus, where lines have formed at automatic cash machines with depositors withdrawing funds as a safety measure, the Times said.

The first proposal for Cyprus to raise the funds was a tax on bank deposits. Banks were instructed to withdraw the appropriate amounts before depositors rushed to withdraw their money, but the first plan was overwhelmingly rejected by the country's 57 members of parliament.

That did not stop the private worries and anger among Cypriots is growing, the Times said.

In an attempt to diffuse the emotions in the island nation, Jeroen Dijsselbloem, the head of the European Union's finance ministers' group, said he took responsibility for fears spreading through Europe that bank accounts were in jeopardy.

"As the Eurogroup president, I will take responsibility," Dijsselbloem said at a European Parliament hearing.

Dijsselbloem said it should have been clear "right from the start," that the tax plan did not threaten bank accounts across the continent.

Cypriot lawmakers, meanwhile, were working out details on a plan to nationalize pension funds from state-run companies and to hold an emergency bond auction, the Times said.

But fears on the street were palpable. "Time is up – we want our cash," said accountant Maria Melitou standing near one of the four cash machines from the Laiki Bank and the Bank of Cyprus that were still operating Thursday.


Federal workers protest furloughs

FORT WORTH, Texas, March 21 (UPI) -- Government employees in Fort Worth, Texas, demanded a stop to federal budget cuts that would mean a 22-day furlough for each worker during this fiscal year.

The Fort Worth Star-Telegram said the turnout was small at a worker rally outside Naval Air Station Fort Worth, where officials have said about 2,200 workers face possible furloughs due to automatic spending cuts known as sequestration.

The newspaper said "more than a dozen" workers showed up to protest the spending cuts. "End sequestration now," one sign held up by protesters said. "Federal employees have sacrificed enough," another sign said.

The workers said their pay levels are already subjected to a two-year freeze in wage increases.

"We are here to show Congress that we are really serious about our jobs and our pay," said local union representative Jennifer Elmore, who works as an Air National Guard electronic technician.

The American Federation of Government Employees said they had called for a "national day of action," to bring attention to the furloughs they consider unfair.

Nationwide, 800,000 federal employees could be subjected to one day per week furloughs until the end of the fiscal year. The sequestration budget aims for a total spending reduction of $1.2 trillion.

"Our message is very clear: sequestration has got to go. If federal employees are furloughed without pay, if offices and plants are shut down, if vacancies aren't filled because of these across-the-board budget cuts, then federal employees won't be able to do the work that the American public expects them to do," said AFGE National President J. David Cox Sr. in a statement.


NAR calls housing market recovery 'healthy'

WASHINGTON, March 21 (UPI) -- A trade group in Washington said 20 months of continuous year-over-year gains in home sales qualified the housing market recovery to be labeled "healthy."

"February existing-home sales and prices affirm a healthy recovery is underway," said the National Association of Realtors, which tracks sales of existing homes.

U.S. sales of existing homes rose 0.8 percent in February over January to a seasonally adjusted annual rate of 4.98 million units from an upwardly revised annual rate of 4.94 million in January.

Sales for the month were 10.2 percent above the 4.52 million annual rate from February 2012, NAR said.

"Job growth in the improving economy and pent-up demand are causing both home sales and rental leasing to rise. Though home prices are rising much faster than rents, historically low mortgage rates are still making home purchases affordable," said NAR Chief Economist Lawrence Yun.

"The only headwinds are limited housing inventory, which varies greatly around the country, and credit conditions that remain too restrictive," Yun said.

The median sales price for existing homes rose on an annual basis for the 12th consecutive month -- the longest streak since June 2005 to May 2006, the association said.

The median price of $173,600 is 11.6 percent higher than in February 2012, the trade group said.

The total inventory of existing homes on the market rose 9.6 percent from January to 1.94 million, a 4.7-month supply at the current rate of sales.

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