Stock markets pick up steam

Updated: Wednesday, February 20 2013, 08:38 AM EST
Stock markets pick up steam story image
WASHINGTON, D.C. (NEWSCHANNEL 3) – World stock markets picked up steam Wednesday morning, after the Dow Jones closed at its highest level in years on Tuesday.

However, stocks could tumble again if the government does not reach a deal to avoid sequestration.

If nothing is done, the U.S. will face steep spending cuts beginning March 1st, which many predict will hurt our economy.

The sequester would automatically cut 85 billion dollars in spending. It was designed to be so severe, it would force lawmakers to reach a deal.
    
The White House wants a plan with smaller spending cuts and more revenue from taxes.
    
Republicans say the government is already too bloated and higher taxes should not be part of this equation.
    
So now, with no deal in sight, the President is pushing for a short-term fix, to allow more time to reach a compromise.

"There's a smarter way to do this, to reduce our deficits, without harming our economy,” President Obama said Tuesday. “But Congress has to act."

Lawmakers will have just a few days to stop the automatic cuts, when they return from recess next week.




Stock markets pick up steam
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Last Update on January 30, 2015 08:34 GMT

ECONOMY-THE DAY AHEAD

WASHINGTON (AP) -- Investors will have their eye on the government's latest estimate of U.S. economic growth when the Commerce Department releases its report on fourth quarter gross domestic product today.

Also, the University of Michigan will issue its monthly index of consumer sentiment for January and the Labor Department will release the employment cost index for the fourth quarter, a measure of wage and benefit growth..

It's also the busiest week of the current corporate earnings season.

The global biopharmaceutical company AbbVie will report quarterly financial results before the market opens, along with Altria Group and MasterCard.

SHAKE SHACK-IPO

NEW YORK (AP) -- Investors apparently have a craving for a better burger.

Hamburger chain Shake Shack Inc. has priced its initial public stock offering at $21 per share, above its proposed range of $17 to $19 per share.

It sold 5 million shares, raising $105 million. The banks managing the deal may buy 750,000 more shares.

Shake Shack cooks burgers to order and promotes its use of natural ingredients, emblematic of what's known as the "better burger" trend.

Its origins date to 2001, when Union Square Hospitality Group, a company owned by restaurateur Danny Meyer, opened a hot dog cart in Manhattan's Madison Square Park. Shake Shack now has 63 locations in nine countries.

The stock is expected to begin trading Friday on the New York Stock Exchange under the "SHAK" ticker symbol.

JAPAN-ECONOMY

TOKYO (AP) -- Japan's industrial output edged higher in December, suggesting the world's third-largest economy may be turning the corner on a recession brought on by a hefty sales tax hike.

Data released Friday showed manufacturing output increased 0.3 percent in December from the same month a year earlier. However, inflation moderated to 2.5 percent from a year earlier, compared with 2.7 percent in November.

The core consumer price index, excluding food, fell 0.2 percent from the month before.

Falling energy costs thanks to the plunge in oil prices had a limited effect, since the CPI excluding both food and energy was unchanged from the previous month.

Japan's jobless rate dipped to 3.4 percent from 3.5 percent the month before. But stagnant wages meant household spending dropped 3.4 percent from a year earlier.

TOYOTA-FATAL CRASH

MINNEAPOLIS (AP) -- Jury deliberations will resume Friday in a case alleging a 1996 Toyota Camry had a design defect that caused a fatal crash.

Jurors left the federal court in Minneapolis without a verdict Thursday and will return Friday to keep deliberating. At one point in their discussions, jurors asked for a video player so they could view some evidence in the case.

The jurors must decide whether Toyota's design of the 1996 Camry had a defect that was unreasonably dangerous. If they find there was a defect, they must decide if it directly caused injuries to those hurt or killed when Koua Fong Lee crashed into another car in 2006.

Lee spent 2 1/2 years in prison before being released after reports suggested some Toyota cars had sudden acceleration problems.

PIPELINE SPILLS-KEYSTONE

BILLINGS, Mont. (AP) -- As Congress presses the Obama administration to approve the Keystone XL pipeline, government records show oil pipeline accidents have become increasingly frequent in the U.S.

An Associated Press review shows accident numbers growing steadily since 2009, reversing a decade-long decline.

Keystone would go from Canada to the Gulf, passing near where 30,000 gallons of crude spilled into Montana's Yellowstone River earlier this month.

The recent breach became the latest in a string of spills to highlight ongoing problems with maintenance of the nation's crude pipeline network.

After the U.S. Senate voted Thursday in favor of Keystone, Sen. Maria Cantwell of Washington state cited the increase in spills in calling for Obama to veto the measure.

Keystone supporter North Dakota Democrat Sen. Heidi Heitkamp said building it was preferable to using older pipelines.

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