For months, the struggling manufacturing sector has dragged down the economy, but new evidence surfaced Tuesday indicating the burden may finally be easing. The National Association of Purchasing Management reported that manufacturing declined for the 13th consecutive month in August, but at a much slower rate, a strong sign that an economic turnaround may be near. The Tempe, Ariz.-based association said its index of business activity rose to 47.9 from 43.6 in July, much better than the 44.0 analysts had been expecting. An index above 50 signifies growth in manufacturing, while a figure below 50 shows contraction.
With the exception of the Chrysler Group of DaimlerChrysler AG, light truck sales carried the load in August for the domestic automakers. Chrysler, Ford Motor Co, and General Motors Corp. all saw declines in total vehicle sales compared with August 2000. GM saw its sales of light trucks, which include minivans, pickup trucks and sport utility vehicles, rise by 7 percent compared with August 2000.
The government is investigating a possible defect in the Ford Expedition’s suspension system, the same problem that led to a recall of the Ford Explorer and Mercury Mountaineer last winter. The National Highway Traffic Safety Administration has received 14 complaints of failure of the front stabilizer bar links in 1997 and 1998 Expeditions.
The Treasury Department sold three-month bills at a discount rate of 3.36 percent, up from 3.35 percent last week. Six-month bills sold at a rate of 3.31 percent, up from 3.29 percent. The new discount rates understate the actual return to investors – 3.434 percent for three-month bills with a $10,000 bill selling for $9,915.10 and 3.412 percent for a six-month bill selling for $9,832.70. In a separate report, the Federal Reserve said Monday that the average yield for one-year constant maturity Treasury bills, the most popular index for making changes in adjustable rate mortgages, edged down to 3.44 percent last week from 3.45 percent the previous week.
Albertson’s Inc. reported a $151 million loss for the second quarter, largely the result of its $12 billion acquisition of American Stores two years ago. It was only the second quarter in 42 years that the nation’s second largest food and drug retailer has had a loss. The last was when the merger occurred in mid-1999. But Chairman Larry Johnston, the former General Electric Co. chief executive with a reputation for ironing out acquisition problems, emphasized Tuesday that profits before the restructuring charge of $558 million exceeded both his projection last spring and Wall Street’s expectations.
From Herald news services
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