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Dec. 3, 2012 at 7:12 PM
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Markets skid to the close

NEW YORK, Dec. 3 (UPI) -- U.S. stock indexes closed lower Monday after a key manufacturing report said factory business activity slowed in November.

The Institute of Supply Management said the Purchasing Managers Index dropped from a growth-positive 51.7 in October to 49.5 in November, with numbers below 50 indicating contraction.

New orders remained positive -- just -- with a mark of 50.3 for the month.

By close of trading, the Dow Jones industrial average shed 59.98 points, 0.46 percent to 12,965.60.

The tech-heavy Nasdaq index shed 8.04 points or 0.27 percent to 3,002.20. The Standard and Poor's 500 gave up 6.72 points or 0.47 percent to 1,409.46.

On the New York Stock Exchange, 1,196 stocks advanced and 1,831 declined on a volume of 3 billion shares traded.

The 10-year treasury note fell 2/32 to yield 1.626 percent.

The euro rose to $1.3058 from Friday's $1.2987. The dollar fell to 82.19 yen from 82.48 yen.

Japan's Nikkei 225 index climbed 0.13 percent, 12.17 points, to 9,458.18.

Britain's FTSE 100 index added 0.08 percent, 4.42 points, to 5,871.24.

SEC charges five accounting firms

WASHINGTON, Dec. 3 (UPI) -- The U.S. Securities and Exchange Commission said Monday it had charged five accounting firms with failing to turn over reports on Chinese companies.

The U.S. market regulator said it was attempting to investigate "China-based companies ... for potential fraud against U.S. investors."

The investigation involved nine companies whose securities are publicly traded in the United States.

However, the SEC said, "the audit firms have refused to cooperate in the investigations."

The SEC charged foreign offices of the so-called Big Four accounting firms, plus one other, with withholding reports in violation of the Securities Exchange Act and the Sarbanes-Oxley Act.

The firms charged are BDO China Dahua Co. Ltd, Deloitte Touche Tohmatsu Certified Public Accountants Ltd., Ernst & Young Hua Ming LLP, KPMG Huazhen and PricewaterhouseCoopers Zhong Tian CPAs Ltd., the SEC said in a statement.

"Only with access to work papers of foreign public accounting firms can the SEC test the quality of the underlying audits and protect investors from the dangers of accounting fraud," said Robert Khuzami, director of the SEC's Division of Enforcement.

"Firms that conduct audits knowing they cannot comply with laws requiring access to these work papers face serious sanctions," he said.

Morgan Stanley trader under investigation

NEW YORK, Dec. 3 (UPI) -- A regulatory filing says CME Group is investigating trading done by Glenn Hadden, the head of Morgan Stanley's global interest rate desk.

Hadden is a star in the world of financial trading. The New York Times reported Monday that Hadden, in a good year, pockets $10 million or more in personal earnings.

At Goldman Sachs, his previous employer, Hadden was made a partner, which implies he made copious amounts of profit for the firm on his trades, the newspaper said.

But he also ran into trouble at Goldman Sachs, which put him on a paid leave of absence in 2009 after complaints surfaced involving his trying to profit from the New York Federal Reserve's bond-buying program -- a program designed to boost the economic recovery.

He left Goldman in 2010 and quickly found work at Morgan Stanley.

However, CME Group -- the owners of the Chicago Mercantile Exchange and the Chicago Board of Trade -- is investigating whether or not Hadden manipulated the treasury securities market by making purchase late in the day that changed the closing price, which would, in turn, enhance the profits on some of his other deals.

The current investigation has the possibility of becoming an escalating controversy, given several Morgan Stanley executives knew of his trouble at Goldman Sachs before they hired him.

Auto sales reflect ongoing recovery

DETROIT, Dec. 3 (UPI) -- Auto sales among top brands rose in November compared with a year earlier, as the industry remains in a recovery mode in the United States.

General Motors sold 186,505 cars and light trucks in November with sales up 3.4 percent compared with November 2011. At Ford Motor Company, sales rose 6.4 percent with sales of 177,092 cars and light trucks.

Chrysler outsold rival American Honda Motor Co. with sales of 122,565, a 14.4 percent gain from November 2011. But Toyota Motor Sales U.S.A. outsold Chrysler with 161,695 cars sold in the month, a 17.2 percent gain over Toyota sales in November 2011.

Honda sold 116,695 vehicles, 5,985 fewer than Chrysler, but November sales rose 38.9 percent from the same month of 2011.

Nissan North America notched 96,197 sales, 12.9 percent more than a year earlier. Volkswagen Group of America posted sales of 49,062 vehicles, a gain of 28.2 percent above November 2011.

South Korean automaker Hyundai Motor America reported 53,487 cars and light trucks sold, a gain of 7.8 percent, while Kia Motors America reported 41,055 sold, up 10.9 percent from November 2011.

Subaru of America sold 28,306 cars and light trucks, a gain of 59.7 percent from the same month of 2011.

GM also leads the industry on year-to-date sales with 2,349,984 sold, a 3.5 percent gain from the first 11 months of 2011.

Total sales for the industry for 2012 include 6,765,889 passenger cars and 6,369,687 light trucks, a total of 13,135,576 cars and light trucks, a gain of 13.9 percent over 2011 January through November.

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