India's government told President Obama to mind his own business after the president urged it to do more to lift curbs on foreign investment. The country's commerce minister later conceded that India could lower some barriers, such as letting foreign airlines take a stake of as much as 49 percent in domestic carriers. Foreign investment in India fell by 38 percent in April and May, compared with the same two months in 2011.
A Senate committee lambasted HSBC for ignoring warnings that money suspected of belonging to Mexican drug cartels was being laundered through its bank in the United States. Concluding a yearlong inquiry, the committee's report also slammed HSBC for "disregarding" suspicions about a Saudi bank's link to al-Qaeda in its dealings with it. HSBC has not been charged with any wrongdoing.
To no one's surprise, J.P. Morgan Chase said its losses related to credit-derivatives trades at its London office had ballooned to around $5.8 billion. It restated its first-quarter earnings. In May the bank had put the loss at $2 billion.
America's banks trotted out their earnings for the second quarter. Bank of America swung to a profit of $2.5 billion, from the $8.8 billion loss it reported a year ago, thanks to cost-cutting and more weeding-out of bad loans. The bank's share price has risen by 40 percent since the start of the year. Citigroup's profit fell by 12 percent, to $2.9 billion. Goldman Sachs saw both revenue and profit drop by around 10 percent.
Credit Suisse announced a plan to raise an extra $15.6 billion in capital following a row with Switzerland's central bank about whether it was adequately capitalized. The very public disagreement had unnerved investors.
Human Genome Sciences, a biotechnology firm based in Maryland, succumbed to a sweetened takeover offer of $3.6 billion from Glaxo Smith Kline, the British drug company. GSK markets HGS's Benlysta, the first new drug approved for lupus autoimmune diseases in 57 years.
The European Union's competition commissioner opened an investigation into whether Microsoft is complying with its commitment to offer a choice of Internet browsers other than its own Internet Explorer on new PCs. Microsoft reached an antitrust agreement with the EU in 2009 to present consumers with a range of browsers, which is said to have boosted the use of rival browsers in Europe, such as Google's Chrome and Mozilla's Firefox. The newer versions of Microsoft's Windows operating system may not explicitly offer the choice, however.
Political economyThe International Monetary Fund released a pessimistic update on the world economy. It expects global GDP to increase by 3.5 percent this year, the slowest pace since 2009. The IMF warned that things could get worse if America did not divert its course from the looming "fiscal cliff" of tax hikes and spending cuts designed to kick in at the end of 2012. It also called for a "robust and complete monetary union" in the euro zone.
