The surge in commodity costs has hurt some food companies. Kraft Foods said its quarterly net income dropped by 13 percent compared with a year ago; Kellogg saw its profit dip by 1.9 percent. But higher grain prices boosted Archer Daniels Midland. The agricultural processor's quarterly profit rose by 42 percent and its revenue increased by 64 percent.
Kirk Kerkorian revealed that he holds a 4.7 percent stake in Ford and wants to increase it. The veteran investor is familiar in America's car-industry boardrooms; he used his (now divested) 10 percent stake in GM to push for a merger with Renault-Nissan, and tried to buy Chrysler in the 1990s. Both efforts failed. However, Kerkorian is apparently impressed with Ford's restructuring program. The carmaker made a quarterly profit of $100 million and said it should turn an annual profit in 2009.
General Motors reported a net loss of $3.25 billion for the first quarter because of charges that stem in part from its remaining equity in GMAC, a financial-services company. Without the charges, the adjusted loss was $350 million, but because sales are rising in Asia and Latin America, this was smaller than expected and GM's share price soared.
São Paulo's Bovespa stockmarket jumped by 6.3 percent to close at a record high after Standard & Poor's unexpectedly upgraded Brazil's foreign debt, which is likely to spur investment.
Political economy The price of oil almost touched $120 a barrel. This caused anxiety in the United States, where the presidential candidates are debating the merits of suspending the federal tax on gasoline over the summer. Meanwhile, OPEC's president forecast that oil prices would reach $200 a barrel if the dollar continued to slide. Chakib Khelil said that "each time the dollar falls 1 percent, the price of the barrel rises by $4, and, of course vice versa."
America's economy grew by a tepid 0.6 percent annual rate in the first quarter. An increase in business inventories offset a slowdown in consumer spending, which rose by 1 percent, the lowest rate of growth since the second quarter of 2001.
More than 70 people were killed in China's deadliest train crash in more than a decade. The accident happened on the line linking Beijing with the coastal city of Qingdao, which will host the sailing competition during the forthcoming Olympics.
The European Union (EU) offered to sign an association agreement with Serbia, which normally is a prelude to membership negotiations. The offer came 12 days before a general election in which it is feared that anti-EU nationalists in Serbia will do well.
