China economy cools further, to 7% growth
China's economic slump deepened as manufacturing and investment cooled in the first quarter of the year, stepping up pressure for Beijing to keep the world's second-largest economy on track. Growth declined to 7 percent from the previous quarter's 7.3 percent, official data showed Wednesday. It was China's weakest performance since the global financial crisis, when growth tumbled to 6.1 percent in the first quarter of 2009. Much of China's decline has been self-imposed as communist leaders try to steer the economy to slower, more sustainable growth based on domestic consumption instead of trade and investment. But a sharp decline over the past year has fueled fears of job losses and social tensions. Beijing has cut interest rates twice since November and launched targeted measures to help exporters and other industries.
Wholesale inflation turns positive again
Higher gas costs drove up wholesale prices last month, ending a string of four straight declines. The producer price index increased 0.2 percent in March, after sharp drops in the two previous months, the Labor Department said. The index measures prices before they reach the consumer. Excluding the volatile food and energy categories, core prices also rose 0.2 percent. In the past year, wholesale prices have plummeted 0.8 percent, the sharpest drop in the four years since the government updated its methods for calculating the index. Cheaper gas caused most of the decline. Core prices have risen 0.8 percent in the past 12 months.
Retail sales rallied in March, rising 0.9%
Americans increased their spending on autos, furniture, clothing and building materials in March, lifting retail sales for the first time in four months. Retail sales jumped 0.9 percent last month, after declining 0.5 percent in February, the Commerce Department said. The rebound suggests that shoppers are returning after an unseasonably cold winter froze sales. Warmer weather fueled a 2.7 percent increase in auto sales and a 2.1 percent boost in building materials, possible signs that the lagging manufacturing and construction sectors might also recover from a winter slump. Excluding the volatile categories of autos, gas, building materials and restaurants, sales rose 0.3 percent.
Nokia in talks to buy Alcatel-Lucent
Nokia Corp. revealed it's in advanced talks to buy the ailing French telecom company Alcatel-Lucent, an apparent bid to become a leading global networks operator. Hopes for a deal were boosted by news that the French government, which has a history of intervening in takeover attempts by foreign companies, would give its blessing. In a brief statement, Nokia said the two companies are in negotiations "with respect to a potential full combination." In Helsinki, Nokia stock closed down 3.6 percent while Alcatel-Lucent saw its share price leap 16 percent. That put Alcatel-Lucent's market value at 12.7 billion euros ($13.42 billion).
New federal rules for brokers unveiled
Brokers who manage Americans' retirement accounts may soon be required to put investors' interests first under new restrictions proposed by the U.S. government. The Labor Department opened the rules to public comment for 75 days. The Obama administration has put its weight behind the move. After opposition from the financial industry to an earlier proposal, administration officials took pains to reassure the industry that the new framework wouldn't end the way brokers do business. The changes would put brokers, who sell stocks, bonds, annuities and other investments, under the stricter requirements for registered financial advisers.
GM cuts price of the all-electric Spark EV
General Motors is the latest automaker to drop the price of an electric car in the face of slow sales. GM is cutting $1,650 off the price of the electric Chevrolet Spark. The new starting price is $25,995. Chevrolet is also offering a 39-month lease for $139 per month. The Spark EV is currently sold only in California and Oregon. It goes on sale in Maryland this summer. GM says state and federal tax credits and additional incentives drop the starting price to $14,995.