Housing Construction Rebounds
Construction of new homes rose in April to the highest level in two years, the Commerce Department reported today. There was an 8.2 percent increase in construction in April, the third increase in four months. Housing construction had fallen to the lowest level in 17 years in March. Apartment building was one of the largest drivers of last month's increase; it surged 40.5 percent. Meanwhile, construction of single-family homes fell 1.7 percent.
Luke Mullins has more on the state of the housing market.
Yahoo Bites Back
Yahoo dissed Carl Icahn yesterday, after the billionaire investor launched a proxy fight designed to force the Internet company to accept a $33-a-share offer from Microsoft. Yahoo said it sent Icahn a letter saying that his proposal "reflects a significant misunderstanding of the facts about the Microsoft proposal and the diligence with which our board evaluated and responded to that proposal." Icahn had told Yahoo's board chairman in a letter that the board had "completely botched" the Microsoft offer, at considerable cost to Yahoo shareholders. Microsoft is mum so far on Icahn's intervention and on whether it is still interested in buying Yahoo.
Rick Newman wrote about the headaches facing Yahoo in the wake of Microsoft's offer.
Abercrombie & Fitch Has Strong First Quarter
Abercrombie & Fitch announced today that its first-quarter earnings are up 3 percent over the corresponding part of last year. Driving this growth was an 8 percent increase in sales, from $742.4 million in last year's first quarter to $800.1 million this year. The clothing retailer, which is popular among teens, predicts that it will see between 5 to 8 percent earnings growth in the first half of the year. International sales might further boost the company; currently, its only store overseas is in London, but it plans to open stores in Copenhagen and Tokyo in 2009, and more are to follow in Italy, France, Germany, Spain, and Sweden.
Kirk Shinkle wrote about the retail sector's performance and how that is linked to the economic stimulus package.
U.S. Industrial Output Drops
Industrial production fell 0.7 percent last month, the Federal Reserve reported. That comes after a slight 0.2 percent increase in March and a 0.7 percent decline in February. Factories, mines, and utilities were at 79.7 percent operating capacity overall; the last time they dipped below 80 percent was in October 2005, in the wake of Hurricane Katrina. Output in the mining sector fell 0.8 percent in April, but output in the utility sector increased 0.3 percent.
World Economy "Teetering on Brink," U.N. Says
The global economy will not grow much this year and is "teetering on the brink" of a downturn, according to a United Nations midyear economic projection. The report predicts 1.8 percent growth for the world economy, down from 3.8 percent in 2007. Developing countries will grow just 5 percent this year, compared with 7.3 percent last year, the report predicted.