BERLIN
Asian stock markets fell Tuesday even as European leaders appeared to have finally clinched a deal for a rescue package to prevent Greece from going belly up.
Japan’s Nikkei 225 index was down 0.2 percent at 9,464.19. Hong Kong’s Hang Seng fell 0.5 percent to 21,323.99 and South Korea’s Kospi lost 0.8 percent to 2,009.79. Benchmarks in Taiwan, Singapore, mainland China and the Philippines also fell.
Australia’s S&P/ASX 200 added 0.7 percent to 4,287.10. New Zealand and Indonesia also rose.
Early Tuesday, a EU diplomat The Associated Press that European leaders had agreed to a rescue package for Greece, which has been teetering on the brink of a major debt default. The rescue money had been delayed because lenders wanted the country to do more cost-cutting first.
The diplomat spoke on condition of anonymity because a formal announcement was pending.
Greece urgently needs the euro130 billion ($170 billion) package before it can move ahead with yet another deal to sharply reduce the amount of money Greece owes its private investors. Without the money, Greece will default on its debts, starting on March 20 when a bond repayment is due.
But the reported deal didn’t make a dent on markets. Many observers feel it falls far short of what Greece needs to prevent financial collapse.
On top of that: Europe does not have the will or the ability to spend the amount actually required to keep Athens afloat, analysts said.
“Greece is a hopeless case,” said Francis Lun, managing director of Lyncean Holdings in Hong Kong.
In Tokyo, a waning yen failed to perk up many of Japan’s big exporters, whose profits increase when the home currency weakens. Panasonic Corp. lost 2.1 percent, Sharp Corp. fell 1.6 percent and Nintendo Co. fell 1.4 percent.
In Australia strong earnings reports helped set a positive tone. OneSteel, the country’s second-biggest steel maker, jumped 11.9 percent after releasing a bullish forecast about growth from its mining interests.
U.S. markets were closed Monday for President’s Day holiday. Traders will be looking for signs of economic recovery in the world’s No. 1 economy on Wednesday, when the National Association of Realtors releases existing home sales for January.
Benchmark oil for March delivery was up $1.65 to $105.25 a barrel in electronic trading on the New York Mercantile Exchange.
The euro jumped to $1.3269 from $1.3159 late Friday in New York. The dollar rose to 79.68 yen from 79.46 yen.
Gasoline prices have never been higher this time of the year.
At $3.53 a gallon, prices are already up 25 cents since Jan. 1. And experts say they could reach a record $4.25 a gallon by late April.
“You’re going to see a lot more staycations this year,” says Michael Lynch, president of Strategic Energy & Economic Research. “When the price gets anywhere near $4, you really see people react.”
Already, W. Howard Coudle, a retired machinist from Crestwood, Mo., has seen his monthly gasoline bill rise to $80 from about $60 in December. The closest service station is selling regular for $3.39 per gallon, the highest he’s ever seen.
“I guess we’re going to have to drive less, consolidate all our errands into one trip,” Coudle says. “It’s just oppressive.”
The surge in gas prices follows an increase in the price of oil.
Oil around the world is priced differently. Brent crude from the North Sea is a proxy for the foreign oil that’s imported by U.S. refineries and turned into gasoline and other fuels. Its price has risen 11 percent so far this year, to around $119 a barrel, because of tensions with Iran, a cold snap in Europe and rising demand from developing nations. West Texas Intermediate, used to price oil produced in the U.S., is up 4 percent to around $103 a barrel. That’s 19 percent higher than a year earlier.
Higher gas prices could hurt consumer spending and curtail the recent improvement in the U.S. economy.
A 25-cent jump in gasoline prices, if sustained over a year, would cost the economy about $35 billion. That’s only 0.2 percent of the total U.S. economy, but economists say it’s a meaningful amount, especially at a time when growth is only so-so. The economy grew 2.8 percent in the fourth quarter, a rate considered modest following a recession.
Gas prices are already an issue in the presidential campaign. Republican candidate Newt Gingrich spoke several times this week about opening up more federal land to oil and gas drilling as a path toward U.S. energy independence _ and lower pump prices.
“Our goals should be to get gasoline to $2.50 or less so that working families can actually get to work and retired families can travel,” Gingrich said at a campaign event in Los Angeles Thursday.
High oil and gas prices now set the stage for even sharper increases at the pump because gas typically rises in March and April.
Every spring, refiners suspend operations to switch the type of gasoline they make. Supplies of wintertime gas are sold off before March, when refineries need to start making a new formula of gasoline that’s required in the summer.
That can mean less supply for service stations, resulting in higher gas prices. And summertime gasoline is more expensive to make. The government mandates that it contain less butane and other cheap organic compounds because they contribute to the formation of ground-level ozone, a primary constituent in smog. That means more oil, a costlier component, is needed to produce each gallon.
The Oil Price Information Service predicts that gasoline could peak at $4 online payday loan lenders.25 a gallon by the end of April. That would top the record of $4.11 in July 2008.
The national average for gasoline began the year at $3.28 a gallon. The average price for February so far is $3.49 a gallon. That’s up from $3.17 a gallon last February, a record at the time. Back in 2007, before the recession hit, the average for February was $2.25 a gallon.
Prices are higher on the East and West Coasts, where gasoline has risen above $3.70 in Connecticut, New York, Washington D.C. and California. This isn’t unusual _ states on the coasts charge some of the nation’s highest gas taxes.
High gas prices put a strain on many people’s budgets.
Americans spent 8.4 percent of their household income on gasoline last year when gas averaged an all-time high of $3.51 a gallon. That’s double the percentage a decade ago. They could pay even more this year, even though demand is the lowest in 11 years as people drive fewer miles in more efficient cars, says Tom Kloza, chief oil analyst at OPIS.
Gary Goodman commutes into Manhattan from Edgewater, N.J., because gas, tolls and parking make the cost of driving prohibitive.
Goodman, an accountant, commutes by bus. He uses his car mostly for trips to the grocery store or for occasional nights out. He says he has no choice but to eat the higher gas costs.
“I already drive as little as possible,” he says.
Paul Dales, a senior economist at Capital Economics says it would take a bigger shift in the global economy _ say, a deep recession in Europe or a slowdown in Asia’s manufacturing _ for pump prices to drop noticeably. Either event would slow oil demand, depressing prices.
But experts expect demand to keep rising. World oil demand is expected to increase by another 1.5 percent to 89.25 million barrels a day in 2012, according to the Energy Information Administration.
In the short term, tensions with Iran are feeding fears that oil supplies could be blocked.
The U.S. and Europe are tightening economic sanctions against Iran over what the West believes is Iran’s attempt to build a nuclear bomb. World leaders fear Israel may be planning a strike against Iran, the world’s third largest oil exporter.
In response, Iran has threatened to withhold its own oil deliveries and to block the Strait of Hormuz, a waterway along its coastline through which one-fifth of the world’s oil flows.
On Friday, an international banking clearinghouse crucial to Iran’s oil sales said it is prepared to discontinue services to Iranian financial institutions being targeted by the EU and U.S. sanctions. That could ratchet up the pressure on Iran, but also send oil prices soaring.
The price of Brent crude fell 53 cents on Friday to $119.58. WTI gained 93 cents to $103.24.
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Reporter Beth Fouhy in Atlanta contributed to this report.
Shares of Apple reached $500 for the first time on Monday, setting yet another high-water mark for the tech giant.
Apple’s (, Fortune 500) stock has been soaring lately, boosted by record sales of the iPhone and iPad. Even the 28-year old Macintosh line continues to set new sales records.
Shares closed at a record $502.60, up 2% from Friday’s close.
But this rise isn’t a recent development. Apple shares have been rising at a consistent trajectory for the past three years.
It was just six months ago that Apple cracked the $400 level for the first time, and it’s been 16 months since it passed $300. Shares traded above $200 for the first time in October 2009. At this time three years ago, shares traded at just $78.20.
Despite Apple’s stunning rise in share price, the company’s stock gains haven’t even kept pace with its earnings.
The stock has grown 40% over the past year, but Apple’s profit has grown 117% since the fiscal first quarter of 2011. Over the past two years, Apple’s stock has grown 150% and profits have soared 286%.
The stock has risen 539% in the past three years, but profits have grown 711% over the same time period.
That means Apple’s shares are relatively cheap.
The tech giant’s stock trades at just 12 times its expected earnings for 2012, which makes it cheaper than the tech-heavy Nasdaq 100, which trades at about 18 times forecast earnings no fax cash advances. And Apple is wildly cheaper than some of the other tech companies out there with far less predictable futures, like Netflix (), Zynga (), LinkedIn () and Facebook.
Apple had $127.8 billion in sales during the 2011 calendar year, putting it neck-and-neck with Hewlett-Packard (, Fortune 500), the nation’s largest tech company by revenue. Yet Apple continues to grow like it’s a startup. This year, Apple is on pace to become the biggest technology company in the world, measured by revenue, outpacing current global No. 1 Samsung.
Last quarter, Apple posted $13 billion in sales. It was one of the most profitable quarters ever for any U.S. company, trailing only ExxonMobil’s (, Fortune 500) record-setting $14.8 billion quarter from the fall of 2008, when oil prices were at an all-time high.
Apple recently surpassed Exxon’s market capitalization to become the most valuable company on any American stock market. Apple’s market cap is nearing $500 billion, which would put it in elite territory. That’s a threshold only reached by Microsoft (, Fortune 500), Cisco (, Fortune 500), General Electric (, Fortune 500) and Exxon for brief moments over the past decade and a half.
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St. Louis Federal Reserve President James Bullard said on Friday the U.S. economy appears to be gaining momentum that will make further Fed purchases of bonds unnecessary.
“The economic news and economic data, including today’s data, has been surprising to the upside,” Bullard said in a Bloomberg News interview. “I need to see significant deterioration in the economy and some threat of deflation or inflation moving significantly below our inflation target before I would consider more” central bank stimulus, or quantitative easing, he said.
The government earlier in the day said employers added 243,000 jobs in January and that the jobless rate dipped to 8.3 percent, a three-year low.
Bullard, who does not have a vote on the Fed’s policy-setting Federal Open Market Committee this year, is seen as a policy centrist.
The Fed last month said it would likely hold interest rates at rock bottom levels until late 2014. Fed Chairman Ben Bernanke was cautious about recent improvement in the U.S. economy and left the door open to new bond purchases to boost growth.
The Fed cut rates to near zero more than three years ago and has bought $2.3 trillion worth of bonds to spur economic activity.
Bullard said economic conditions are different now than when the Fed launched its last bond buying initiative in late 2010. At that time, inflation was so low policymakers were concerned the economy was at risk of tipping into a dangerous deflationary spiral, but that is not now the case, Bullard said.
“Inflation is coming down but at least for now it is above our inflation target” of 2 percent, he said. “We will see how things develop. But I am also more bullish on the economy as a whole. I do think we have momentum coming out of 2011.”
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Brooke Gray could be either of two things: an insufficiently educated opportunist, trying to pass herself off as an equine dentist, or a young woman dedicated to horses, performing an age-old practice for an honest wage.
A circuit court judge recently said the former. Her attorney, a St. Louis-based litigator with a history of challenging the government’s licensing power, says the latter — and believes the judge’s ruling could limit everyone from cattle hands to dog groomers.
A Clinton County Circuit Court judge ruled in December that Gray had to stop a practice called “teeth floating” after the Missouri Veterinary Medical Board, which oversees veterinary licenses in the state, sued Gray because she does not have a veterinary license.
Her attorney plans to appeal the ruling, saying that Gray is merely practicing something that unlicensed lay people have done for hundreds of years.
“Up until 15 years ago no one in Missouri considered these animal husbandry practices veterinary medicine,” said Gray’s attorney, David Roland, who helms the libertarian Missouri Freedom Center. “That’s how animal agriculture has always been done.”
Roland calls Gray’s case “the tip of the iceberg” and says it could have ramifications for anyone who wants to perform “basic animal husbandry” without a license.
But state law, veterinarian groups and the board say veterinary practices are regulated for a reason: to protect animals and their owners from untrained, unskilled workers. They say the practice of teeth floating, which often requires sedation, should be done either by, or under the supervision, of a licensed veterinarian.
“The public seems to think the licensing board is there to protect veterinarians,” said Bruce Whittle, chair of the equine committee for the Missouri Veterinary Medical Association, the group that represents the state’s vets. “It’s to protect the public against veterinarians that are doing harm.”
Gray, who lives north of Kansas City, grew up on an Iowa farm and always wanted to work with horses. So, about eight years ago, she got two months of training at an equine dentistry school in Idaho, then moved to Missouri and opened B & B Equine Dentistry.
She built a steady clientele floating horses teeth, which involves filing down the sharp points that emerge on the enamel. Sharp edges can make it difficult for the horse to eat. Her customers, she says, liked her work.
“I’ve never had a complaint from a client,” Gray said.
She did, however, get a complaint filed against her from a local Clay County vet, David Leighr, whose clients told him that Gray was improperly sedating horses and, in some cases, extracting teeth. Under state law, sedation by anyone other than an owner or licensed vet is illegal, while extraction is a surgical practice, which makes it a veterinary practice, and therefore also illegal for someone to perform without a license.
“One of my clients told me that Brooke had sedated an animal and hit a vein,” Leighr said. “Brooke also had them sign a piece of paper that said she was not responsible for anything that happens. A vet doesn’t do that. That raised a red flag with me.”
When asked if she had extracted teeth, Gray said: “I’ve taken some things out of horses mouths that didn’t belong there.” When asked if she had sedated horses, she said: “I’ve been informed not to say anything about the sedation issue.”
Leighr called the board, and eventually, it began to pursue the matter.
After sending two cease-and-desist letters, the board sued Gray to make her stop. She didn’t. So in September, the matter went to trial.
Roland says he believes the board pursued the case on behalf of veterinarians who felt they were in danger of losing income to untrained teeth floaters, not because they were concerned about animal welfare.
“One of the quirks of the law is that it’s not illegal to do the work on the animals,” he explained. “But if they get paid for it, it’s a criminal offense. So this is not a health issue.”
Several states, he said, have recently changed laws to allow teeth floating by nonvets, and he’ll push for Missouri to do the same.
He also points to a number of cease-and-desist letters sent by the board aimed at stopping everything from branding to pet grooming practices. These, he says, are evidence the state is trying to regulate practices that should not require licensing.
“This is an issue that’s been gaining momentum for a couple of years,” he said.
Gray believes the board is merely requiring a costly education — vet school runs an average of $150,000 — for something she specifically trained to do.
But veterinarians, including Leighr — a fourth-generation vet who said news coverage of the issue in his practice area had cost him business — maintain this issue centers on animal welfare and training.
“Her attorney is trying to convince the public that lay professionals have been doing this for years and that it’s safe,” he said. “I don’t think it’s safe. … And the fact that’s she’s using sedation and there’s no oversight makes it even less safe.”
“I went to school for eight years,” Leighr added. “I’ll put my records out there all the way back to high school, and I challenge her to do the same.”
Gray said she would continue floating teeth, only under the supervision of vets, until the appeal is resolved. That, Leighr insisted, is all he’s wanted all along.
“I said to her: ‘You can do this all day long by having a vet present,’” he said. “Missouri is full of vets retiring every day. They’d be tickled to death to get in the truck with you and go on a farm call.”
Samsung Electronics Co. and Hyundai Motor Co. (005380), South Korea
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