UnitedHealth Group Inc., the country’s second-largest health insurer behind WellPoint Inc., said Tuesday that federal regulators have begun a formal investigation into its historical stock options practices. The Securities and Exchange Commission’s formal order follows an informal inquiry begun in April. Minnetonka, Minn.-based UnitedHealth said in SEC filing it intends to cooperate with the investigation.
Home prices rise at slowest rate
Prices of single-family homes across the nation rose in October at the slowest rate in almost a decade, a housing index released Tuesday by Standard &Poor’s showed, giving more evidence of the housing market’s deceleration, which has affected many parts of the broader economy. The S&P/Case-Shiller composite index showed a 2.4 percent year-over-year increase in the price of a single-family home based on prices of existing homes tracked over time in 10 metropolitan markets.
Economy expected to have soft landing
A trade group representing the nation’s manufacturers on Tuesday predicted a soft landing for the U.S. economy in 2007, despite expectations that residential real estate will act as a drag on growth. In its annual forecast, the National Association of Manufacturers forecast that industrial output would decelerate to a growth rate of 2.8 percent, or slightly below the 2.9 percent rate of expansion it expects for the overall economy. The manufacturing sector grew by 4.5 percent, on average, in 2006, while the U.S. economy expanded by 3.1 percent, according to the association.
China curtails auto investment
China announced curbs Tuesday on surging investment in its auto industry, extending controls already imposed in other fields in an effort to cool off an economic boom that Beijing worries could ignite a financial crisis. It was not clear how the controls would affect foreign automakers that are setting up factories in China, the world’s third-largest auto market, where sales are growing at double-digit annual rates.
T-bill rates rise in Monday auction
The Treasury Department auctioned three-month bills at a discount rate of 4.875 percent, up from 4.825 percent last week. Six-month bills were auctioned at a discount rate of 4.9 percent, up from 4.885 percent last week. The three-month rate was the highest since the bills averaged 4.905 percent on Nov. 27. The six-month rate was the highest since 4.935 percent, also on Nov. 27. The discount rates reflect that the bills sell for less than face value. For a $10,000 bill, the three-month price was $9,876.77 while a six-month bill sold for $9,752.28. The weekly Treasury auction was held on Tuesday rather than Monday because of the Christmas holiday. Separately, the Federal Reserve said that the average yield for one-year Treasury bills, a popular index for changing adjustable rate mortgages, edged up slightly to 4.96 percent last week from 4.95 percent the previous week.
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