Nation roundup for October 19
Train strike clogs Bay’s highways
OAKLAND, Calif. (AP) — San Francisco Bay Area rapid transit workers are on strike for the second time since July, scrambling the morning commute for hundreds of thousands of workers who were up before dawn to clog highways, swarm buses and shiver on ferry decks as they found alternative ways to the office.
Six months of on-again, off-again negotiations have brought agreement on key issues such as raises, health care and pensions.
But there remained a snarl Friday: a package of work rules involving when schedules are posted, whether workers can file for overtime when they’ve been out sick, and how paychecks are delivered.
The labor details were meaningless to Marsha Smith, who watched the sun rise as she rode toward her office in a crowded bus. Like many commuters Friday, Smith left her house while the moon was still shone brightly to be sure to make it in on time.
“I am so tired. I am so frustrated and I’m so over it,” the court records supervisor said.
At the West Oakland BART station, a frazzled Tatiana Marriott raced to board a free charter bus to San Francisco shortly after 6 a.m. She had to be at work by 7 a.m.
“I probably should’ve gotten up a half-hour earlier,” said Marriott, 21, a seamstress, conceding that she would be late for work.
The Bay Area Rapid Transit system carries a ridership of 400,000 daily through tunnels under the bay and into the region’s urban core of San Francisco from four surrounding counties, relieving what would otherwise be congested bridges.
Ex-Congressman Foley dies at 84
WASHINGTON (AP) — Tall and courtly, Tom Foley served 30 years in the House when partisan confrontation was less rancorous than today and Democrats had dominated for decades. He crowned his long political career by becoming speaker, only to be toppled when Republicans seized control of Congress in 1994, turned out by angry voters with little taste for incumbents.
Foley, the first speaker to be booted from office by his constituents since the Civil War, died Friday at the age of 84 of complications from a stroke, according to his wife, Heather.
She said he had suffered a stroke last December and was hospitalized in May with pneumonia. He returned home after a week and had been on hospice care there ever since, she said.
”Foley was very much a believer that the perfect should not get in the way of the achievable,” Ms. Foley wrote in a 10-page obituary of her husband. She said he believed that “half of something was better than none.”
“There was always another day and another Congress to move forward and get the other half done,” she wrote.
“America has lost a legend of the United States Congress,” President Barack Obama said in a statement Friday, adding, “Tom’s straightforward approach helped him find common ground with members of both parties.”
Foley, who grew up in a politically active family in Spokane, Wash., represented that agriculture-heavy area for 15 terms in the House, including more than five years in the speaker’s chair.
Mentally ill man’s shooting probed
DALLAS (AP) — Surveillance video showing a Dallas police officer shooting a mentally ill man standing still about 20 feet away contradicts the assertion of an officer that the man threatened his safety by lunging at him with a knife.
Bobby Gerald Bennett remains hospitalized after being shot in the stomach Monday. The officer who shot him, Cardan Spencer, is on indefinite administrative leave pending a criminal investigation after a neighbor released surveillance video that captured the incident.
Bennett was charged with aggravated assault with a deadly weapon on a public servant, but Police Chief David Brown announced Friday that the charge would be dropped.
Bennett’s mother, Joyce Jackson, said in an interview Friday that her 52-year-old son has been diagnosed with schizophrenia and bipolar disorder, and that he was off his medication at the time of the shooting.
Holmes lawyers want emails barred
CENTENNIAL, Colo. (AP) — Lawyers for Colorado theater shooting suspect James Holmes on Friday added his emails to the list of evidence they say should not be allowed at his trial.
Holmes pleaded not guilty by reason of insanity to charges of killing 12 people and wounding 70 others in the July 2012 attack. Prosecutors are looking for any evidence, such as emails, that might show signs of rationality that would undermine the insanity defense.
The defense is trying to block the emails, as well as statements Holmes made to police and evidence seized from his car, computers and iPhone.
At a pretrial hearing Friday, defense attorneys said the affidavits and court orders used to obtain the emails were so broad they swept up some emails that merely mentioned Holmes but weren’t sent to or from his accounts. Prosecutors said the requests had to be broad because investigators initially didn’t know if Holmes had accomplices.
S&P 500 pushes toward record
NEW YORK (AP) — Investors shifted their focus from politics to profits on Friday and liked what they saw, pushing the Standard & Poor’s 500 index further into record territory.
Two days after Congress struck a last-minute deal to keep the U.S. from a devastating default on its debt, investors were bidding up stocks on surprisingly good profits from companies in industries both old and new.
General Electric and Morgan Stanley rose after reporting higher earnings than financial analysts had expected. Google surged nearly 14 percent, topping $1,000 a share for the first time.
“We’ve moved from the dysfunction of Washington to the reality of the global economy, and it looks pretty good,” said Ron Florance, deputy chief investment officer at Wells Fargo Private Bank.
Investors were also encouraged by a rebound in Chinese economic growth in the latest quarter. The rise in stocks follows a budget standoff in Washington that kept hundreds of thousands of federal workers from their jobs for 16 days.
and could have forced the government to miss payments on its debt. Congress agreed Wednesday to fund the government and allow it to borrow through early next year.
The S&P 500 set a record for the second straight day. The broad index of 500 companies, up 22 percent this year, added 11.35 points, or 0.7 percent, to a record 1,744.50. The gain this year is the index’s best since 2009, when it began its bull run. Since its recession low in March of that year, the S&P 500 has soared 158 percent, driven largely by a rebound in earnings, a housing recovery, greater investor confidence and the economic stimulus program by the Federal Reserve.
The Nasdaq composite was up 51.13 points, or 1.3 percent, at 3,914.28. The Dow Jones industrial average rose 28 points, or 0.2 percent, to 15,399.65, and is 277 points below its own record.
Christine Short, a senior manager at S&P Capital IQ, said investors are relieved that Washington pulled back from the abyss by extending the U.S. borrowing authority until Feb. 7. But she’s not so sure how long the celebratory mood might last.
“We just bought ourselves a little more time, and the market seems to like that,” she said. “But we’re likely to go through the same cycle again in three months.”
Another concern is earnings. Despite good reports from a few big companies Friday, the third-quarter reporting season has just started and most companies aren’t expected to post blowout results.
Earnings for S&P 500 companies are expected to have grown 3.4 percent from a year earlier, the smallest quarterly increase in a year, according to S&P Capital IQ. At the start of 2013, third-quarter earnings were expected to grow at nearly triple that pace.
What’s driven stock prices up this year hasn’t been earnings as much as investors’ willingness to value them more. At the start of the year, stock buyers were paying $14 for every $1 of S&P 500 earnings, according to S&P Capital IQ. Now, they are paying more than $16.
Investors will have a better idea of the U.S. corporate profit picture next week when several big companies report results, including McDonalds on Monday and Boeing and Caterpillar on Wednesday and Ford on Thursday.
Google jumped $122.61 to $1,011.41 Friday. It reported a 36 percent jump in earnings after the stock market closed Thursday. An erosion in Google’s ad pricing was more than offset by a big increase in the frequency of clicks on Google’s ads.
General Electric rose 87 cents, or 3.5 percent, to $25.55, after topping analysts’ expectations for net income, excluding charges for shedding its media and banking operations. Stock of GE, which makes jet engines and other industrial products, is the highest it’s been since the start of the financial crisis in September 2008, when some investors doubted the company could survive intact.
Morgan Stanley rose 76 cents, to $29.69, a gain of 2.6 percent. The investment bank reported that its earnings nearly doubled on strong results in stock sales and trading, beating analysts’ estimates. Morgan Stanley is up 55 percent this year, the most among major banks and nearly twice the gain of the next-best performing bank stock, Citigroup.
Nine of the 10 industries in the S&P 500 rose, led by information technology companies, up 1.8 percent. Stocks in the health-care industry fell 0.4 percent.
The Chinese government reported Friday that the world’s second-largest economy grew by 7.8 percent in the three months ending in September, a pickup from the previous quarter. Investors have worried that slower growth would not only hurt big commodity exporters like Brazil and Australia but drag down the global economy, too.
Among other stocks making news:
— Chipotle Mexican Grill jumped $70.67, or 16 percent, to $509.74, the biggest gain in the S&P 500. The company reported that its third-quarter earnings rose 15 percent on higher traffic to its 1,500 restaurants.
— Voxeljet, a 3-D printing company from Germany, more than doubled in its debut offering, jumping $15.80 to $28.80. The company makes printers that build 3-D objects by layering plastic and other materials atop each other. It raised $84.5 million in its initial public offering.
In bond trading, the yield on the 10-year Treasury note was unchanged at 2.59 percent.
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