Oil prices darken mood on Wall Street
Oil prices reached a new high and sent stocks lower Monday, pushing the Dow Jones industrials below 10,000. But with trading on Wall Street light and losses only moderate, investors seemed to be coming to terms with crude nearly at $50 per barrel.
As a barrel of light crude for November delivery settled at $49.64, up 76 cents on the New York Mercantile Exchange, stock investors grew more fearful that rising energy prices would slice into corporate profits. Monday's close for crude broke the previous record settlement price of $48.88 set Friday, and prices reached $49.75 earlier in the session, marking the highest intraday trading level recorded.
Oil producers and refiners still struggled to recover from Hurricane Ivan's damage in the Gulf of Mexico, and global demand continues to tighten, analysts said, making the markets susceptible to even minimal losses in overall production.
Fannie Mae, regulators reach new agreement
Under pressure from federal regulators, Fannie Mae's board has agreed to take sweeping action to correct what were cited as serious accounting problems.
Fannie Mae agreed to boost the mortgage giant's capital, recalculate key transactions back to 2001 and tighten internal controls.
The government-chartered mortgage financier and its regulator said Monday they had reached an agreement after negotiations last week and during the weekend.
A week ago, the Office of Federal Housing Enterprise Oversight told Fannie Mae that its 8-month-old investigation had found pervasive earnings manipulation to meet Wall Street expectations and serious accounting misdeeds. The office ordered "immediate remedial action."
Walgreen profits increase
Walgreen Co. increased its fourth-quarter profits by 18 percent despite slower growth in prescription drug sales industrywide, taking market share from competitors as it gains ground on the biggest U.S. retailers.
Net earnings reported Monday for the June-through-August quarter were $327.2 million, or 32 cents a share, up from $277.1 million, or 27 cents a share, a year earlier. That was a penny per share higher than the consensus estimate of analysts surveyed by Thomson First Call.
Walgreen's rapid growth has lifted the company into the top 10 U.S. retailers in the past year and a half and it now stands sixth.