U.S. Jobless Claims Fall; U.S. Middle Class Consumer Spending Rebounds

Arthi Gupta
30 Dec, 2010
New York City

U.S. weekly jobless claims declined 34,000. PAA Natural Gas agreed to buy SG Resources Mississippi for $750 million. Boston Properties completed the acquisition of John Hancock Tower for $930 million. A private survey of consumers indicates a sharp rebound in consumer spending in upper middle class.

[R]9:10 AM New York – U.S. weekly jobless claims declined 34,000. PAA Natural Gas agreed to buy SG Resources Mississippi for $750 million. Boston Properties completed the acquisition of John Hancock Tower for $930 million. A private survey of consumers indicates a sharp rebound in consumer spending in upper middle class.[/R]

U.S. indexes trade sideways on a day when trading volumes are generally one third lower from average volume. Inclement weather condition in the Northeast has postponed retail sales to the next months as shoppers are unable to reach stores.

Thousands of travelers remained stuck in New York-area airports on Wednesday, as the airlines struggled to cope following the blizzard that wreaked havoc in the Northeast.

The runways at New York's three major airports are all open, but the substantial backlog of passengers continues to create problems, with some international flights stuck on the tarmac for hours.

Certain areas of New York City remain buried in snow, as abandoned ambulances, trucks, and cars make it impossible to get snow plows down some streets even though the snow finally stopped falling.

U.S. Weekly Jobless Claims Decline

First-time claims for U.S. unemployment benefits fell more than expected in the week ended December 25, according to a report released by the Labor Department on Thursday. Weekly jobless claims declined below 400,000 for the first time in two years.

The report showed that initial jobless claims fell 34,000 to 388,000 from the previous week's revised figure of 422,000. The preliminary insured unemployment rate in the week ending December 18 dropped to 3.3% from the prior week's unrevised rate of 3.2%.

China's manufacturing activity rose at a pace that was the slowest in three months in December, survey data showed.

The Markit/HSBC manufacturing purchasing managers' index eased to a seasonally adjusted 54.4 in December, from 55.3 in November.

Retail Stores Sales Fall on Blizzard

U.S. retail store sales for the Christmas week declined 4.1% and foot traffic dropped 6.8% from last year, according to ShopperTrak's National Retail Sales Estimate released on Wednesday. The ShopperTrak estimate also showed that about $1 billion of retail sales for December 26 and 27 were postponed due to the blizzard in the Northeast.

Self-reported consumer spending showed a notable increase in the week ended December 26, according to data released by Gallup on Wednesday, with the increase driven by a jump in spending by upper-income shoppers.

Upper-income Americans' self-reported consumer spending in stores, restaurants, gas stations and with online retailers averaged $183 per day during the week ended December 26, up from $126 during the same week a year ago.

comScore, Inc. reported holiday season retail e-commerce spending for the first 56 days in the two months to December holiday season increased 13% to $30.81 billion from a year ago.

Paul Allen Re-Launches Lawsuit against Tech Companies

Microsoft co-founder Paul Allen’s firm Interval Licensing LLC decided to re-launch a patent-infringement lawsuit against some of country’s biggest tech companies.

The suit targets AOL, Apple, Facebook, Google and its subsidiary YouTube, Netflix, Yahoo, Office Depot, Officemax and Staples. Interval alleged that the companies infringed four of its patents mainly related Web data sorting and presentation.

PAA Natural Gas Storage Acquires SG Resources Mississippi

PAA Natural Gas Storage LP agreed to acquire SG Resources Mississippi, LLC for a total consideration of about $750 million. The transaction is expected to provide PAA Natural Gas enhanced access to important and growing Southeast U.S. power generation market.

Simon Property Secures £3 billion Loan

Simon Property Group, Inc., the shopping mall operator said that it agreed on the financial terms for a loan facility of £3 billion or $4.62 billion. The loan will help the company to complete the offer for UK-based real estate investment trust Capital Shopping Centres Group plc.

Boston Properties Completes Acquisition of John Hancock Tower

Boston Properties, Inc., a real estate investment trust, completed the acquisition of the John Hancock Tower and Garage located in Boston, Massachusetts for an aggregate purchase price of approximately $930.0 million.

The purchase price consisted of approximately $289.5 million of cash and the assumption of approximately $640.5 million of debt.

Pfizer Animal Health Acquires Synbiotics

Pfizer Animal Health announced an agreement to acquire Synbiotics Corporation, a privately held, Kansas City-based maker of immunodiagnostic tests for companion and food production animals.

The deal provides Synbiotics common shareholders with $0.306 per share in cash, of which about $0.019 per share will be held in escrow as a fund that would indemnify Pfizer for losses arising from any breaches of Synbiotics' representations and covenants.

Sony Sues LG

Sony Corp. filed a patent infringement complaint against LG Electronics, asking for a ban on exports and sales of LG mobile phones responsible for the breach in the U.S. market. Sony submitted the complaint to the U.S. International Trade Commission and also filed a lawsuit at the U.S. District Court in Los Angeles for the same infringement.

LG Electronics said on Thursday it would """"actively respond"""" to a lawsuit filed by Japan's Sony that seeks to block mobile phone shipments to the United States by the South Korean firm.

Sony filed a patent infringement complaint claiming LG's mobile phones sold in the United States had used its technologies without permission.

LG said it would take action after reviewing the technologies.