In a bid to offset the climbing price they pay for jet fuel, airlines have been increasing some fees while introducing new ones. The practice is paying off, according to a government report issued Tuesday, as US airlines took in a staggering $3.5 billion in checked baggage fees alone in 2012. The total represents a 3.8 percent increase over bag fees the previous year and is a new record high. While the existence of many of these fees sparks ire in passengers, the widespread implementation of them across the airline industry gives them no choice but to pay. Tuesday's report buoyed airline investors, with many major US carriers seeing their shares gain more than 1 percent during the day's trading session.
Sony Corporation has come under pressure to sell off part of its entertainment business in order to strengthen its struggling electronics unit. Daniel Loeb, the billionaire activist investor and CEO of hedge fund Third Point, a major Sony shareholder, wrote a letter to Sony top executive Kazuo Hirai on Tuesday suggesting the move. Loeb said that Sony should put a 20 percent stake in its entertainment unit up for sale and use the proceeds to pump cash into the electronics division, which has struggled over the last few years. Hirai, meanwhile, published a reply to Loeb's letter later on Tuesday, indicating in no uncertain terms that no part of Sony is for sale, and the company will continue to take steps to strengthen both segments of its business.
Swedish foodmaker Nestle revealed Friday it is recalling tens of thousands of DiGiorno and California Pizza Kitchen frozen pizzas after finding very small pieces of plastic in spinach used on several varieties. According to a statement the company posted on the US Food and Drug Administration website, a handful of customers complained about finding the plastic as well. While the recall was posted on the FDA's website, the recall was voluntary, and there have been no reports that the plastic pieces can be hazardous. Nonetheless, Nestle recommends that consumers not eat the pizzas and call Nestle customer service at 1-800-456-4394. The company is offering free coupons for replacement pizzas for customers who purchased the affected pies.
Ever since the shooting at Sandy Hook Elementary School last December, business has been good for manufacturers of firearms and ammo, though somebody forgot to tell investors, as shares in companies like Sturm Ruger, Smith and Wesson and others are starting to level off. Sales are up drastically, as there were 44 percent more background checks conducted during the first quarter than in the same period a year earlier. Though not all background checks end in a gun purchase, the upswing suggests high demand in response to political rhetoric about gun control legislation. Gun stocks have risen as, well, though not at the same pace. Sturm Ruger has been the best performer among major gun makers, with shares gaining 10 percent so far this year, while Smith & Wesson stock has improved about 3 percent.
The US Labor Department issued its Jobs Report for April Friday, prompting excitement among investors that pushed the Dow Jones industrial average above 15,000 for the first time ever. According to the report, the economy gained a healthy 165,000 jobs last month, easily ahead of the 140,000 projected by a group of economists in a recent Bloomberg survey. But the good news didn't stop with April job creation, as the Labor Dept. also revised its figures for March and February. The agency said that 138,000 jobs were created in March, instead of the originally reported 88,000; and that February brought a whopping 332,000 jobs, making it the best month for US job creation since 2010 when the US Census Bureau boosted the figures with temporary hires.
Things were looking up in April for America's Big 3 automakers as each posted sales numbers up dramatically on a year-over-year basis. With an 11 percent increase in sales over the same month a year ago, Chrysler enjoyed its best monthly performance in six years, while General Motors matched the 11 percent gain and Ford enjoyed a stunning 18 percent gain in deliveries thanks in part to the popularity of its revamped Escape sports utility vehicle. The lucrative sales figures offer evidence that Americans feel positive about long term economic conditions despite the nation's continued struggle with unemployment and an unsure overall economic picture.
The Institute for Supply Management reported Wednesday that manufacturing growth slowed to a trickle in April while a separate report showed a slowdown in construction spending, leading some economists to lower their guesses for first-quarter US economic growth. The group's index of manufacturing activity fell from March's reading of 51.3 to 50.7, just below the average projection from economists in a recent Reuters survey. The reading does still indicate growth however, as the index is calculated on a 1-100 basis, with any reading over 50 indicating growth.
Social gaming pioneer Zynga reported its first-quarter results following Wednesday's closing bell, posting a surprise profit thanks to a series of successful cost-cutting measures. The news wasn't all good, however, as the company offered a weaker-than-expected outlook for the current quarter, prompting an after-hours sell-off that saw shares sink some 10 percent in aftermarket trading. Of course, the stock was up 42 percent on the year at the close, so Wednesday's losses are not likely to spark any major wave of concern for the company.
The United States Federal Reserve on Wednesday revealed its revamped, hi-tech $100 bill which will go into circulation beginning October 8th. The new bill has a number of features designed to make it harder to counterfeit and help retailers spot fakes at the register. The Fed has been working on the new $100 bill for several years, but production delays forced the agency to move back the release of the new bill by three years. The agency revealed the bill on its website Wednesday, breaking down all the new security features and including a pic of the bill, which can be seen above.
Ford Results Beat the Street on Strong North American Performance
Ford Motor Company issued its first-quarter results Tuesday, surpassing analyst expectations with earnings as its performance in North America helped offset weakness in other parts of the world. The performance is a reflection of Ford's efforts over the last 18 months to expand its stable of offerings while pumping new life into its F-Series of pickup trucks. Thanks to its success in the US, Ford said its revenue and deliveries increased in the quarter by about 10 percent on a year-over-year basis.