DETROIT — The Detroit automakers' share of the U.S. market dropped below 50 percent in July for the first time in history, according to an analyst who tracks industry numbers.

Jesse Toprak, senior analyst for the Edmunds.com automotive Web site, said that with 95 percent of the manufacturers reporting data, the market share controlled by Chrysler Group, Ford Motor Co. and General Motors Corp. dropped to 49.7 percent for the month.

The automakers who have yet to report data are small and would not push the three back over 50 percent, Toprak said Wednesday.

The Detroit automakers' share was as high as 77.4 percent in 1984, according to Autodata Corp., which has tracked auto sales since 1980.

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VARIOUS UNITS HELP DISNEY PROFIT JUMP 5%

LOS ANGELES — Profit at The Walt Disney Co. increased 5 percent in the third quarter on increased attendance at its theme parks, higher ad and subscription income from its TV channels and the sale of Disney merchandise, the company said Wednesday.

The company also said Wednesday it had acquired the online virtual world Club Penguin for $350 million.

The Burbank-based media conglomerate reported net income of $1.178 billion, or 57 cents per share, for the quarter ended June 30, compared to $1.125 billion, or 53 cents per share, in the same period last year.

Revenue climbed to $9.045 billion from $8.474 billion in the year-ago period.

Analysts surveyed by Thomson First Call had expected profit of 55 cents per share on revenue of $9 billion.

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INVESTORS TAKE ACTION AGAINST BEAR STEARNS

NEW YORK — Investors in two Bear Stearns Cos. hedge funds took action against the company Wednesday for allegedly misleading them about the extent of the investment bank's exposure to risky mortgage-backed securities, a lawyer for the plaintiffs said.

The move comes as the two funds filed for bankruptcy protection, two weeks after the company told investors one was essentially worthless and the other had lost more than 90 percent of its value.

As the fate of those two funds moves into court, Bear Stearns said it moved late Tuesday to prevent investors from pulling money out of a third hedge fund, which had $850 million invested in highly rated mortgage-backed securities.

The company told investors the Asset-Backed Securities fund was not near collapse, but that it froze redemptions to prevent from being forced to sell assets to a market with little appetite for mortgage-related securities.

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OIL PRICES FALL AFTER HITTING NEW RECORD

NEW YORK — Oil prices retreated after jumping to a new record Wednesday on the government's report of a steep drop in crude inventories and surge in refinery activity.

Crude prices initially rose after the Energy Department's Energy Information Administration reported that oil inventories fell by 6.5 million barrels last week, far more than expected. But gas futures fell on word that refiners ramped up their operations much quicker than expected. As the slide in gas futures prices accelerated, oil prices had little choice but to follow, said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago.

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AMO WITHDRAWS BID FOR BAUSCH & LOMB

ROCHESTER, N.Y. — Advanced Medical Optics Inc. on Wednesday withdrew its $4.2 billion buyout bid for rival eye care products maker Bausch & Lomb Inc., clearing the way for Bausch & Lomb to be acquired by private equity firm Warburg Pincus for $3.67 billion.

In a letter to Bausch & Lomb's board members, Advanced Medical's chief executive, James Mazzo, said he had concluded they "remain intent on delivering Bausch & Lomb to Warburg Pincus at $65 per share" in cash versus his Santa Ana, Calif.-based company's cash-and-stock offer of $75 a share.

Mazzo described the Warburg deal as inferior "both in terms of value and the ability for the Bausch & Lomb shareholders to participate in the significant synergies that combining AMO and Bausch & Lomb would create.

Shares of Bausch & Lomb fell $1.39, or 2.2 percent, to $62.54 Wednesday. They have traded within a 52-week range of $43.97 and $77.

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TIME WARNER EARNINGS UP THANKS TO CABLE TV

Strength in cable TV helped Time Warner Inc. increase second-quarter earnings 5 percent, beating analyst forecasts Wednesday, though the results were clouded by a new set of issues in the AOL Internet unit.

The New York-based media conglomerate, which owns CNN, HBO and the Time Inc. publications, said that from April to June it earned $1.07 billion, 28 cents per share, ahead of last year's profit of $1.01 billion and 24 cents per share. Revenue rose 6 percent to just under $11 billion.

Excluding discontinued operations and gains from an accounting change, Time Warner said it would have earned 25 cents a share. On that basis, analysts polled by Thomson Financial were expecting 21 cents per share. The revenue forecast had been $11.1 billion, slightly higher than what was achieved.

Although Time Warner also announced a new $5 billion stock buyback plan, shares fell 62 cents, or 3.2 percent, to $18.64 Wednesday.

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MANUFACTURING INDEX DOWN SLIGHTLY IN JULY

NEW YORK — While the U.S. manufacturing sector grew for the sixth consecutive month in July, expansion was the slowest since March, a survey said Wednesday, indicating that the economy is plodding along at a tepid pace.

The Institute for Supply Management said its manufacturing index, which reflects the opinions of purchasing managers at factories, plants and utilities, registered 53.8 in July, down from 56.0 in June.

Wall Street expected the manufacturing index to remain unchanged from June, according to the consensus estimate of Wall Street economists polled by Thomson/IFR.