Wal-Mart Chief Executive Lee Scott warned earnings in the current quarter could fall short of Wall Street expectations and said Tuesday that the company will focus on prices this summer in a bid to rekindle sales in U.S. stores.

The tepid outlook from Wal-Mart — considered a barometer for the retail industry — could serve as a warning bell that rising gasoline prices and a weakening housing market will continue to erode consumer spending in the coming months. Home Depot Inc. reported a 29.5 percent drop in first-quarter profits on a slight increase in sales the same day.

Wal-Mart Stores Inc. reported an 8 percent gain in its fiscal first-quarter earnings, meeting profit expectations with the help of cost controls and strength in its Sam's Club warehouse stores and international businesses.

The world's largest retailer said it expects second-quarter profits of 75 cents to 79 cents per share. Analysts surveyed by Thomson Financial are looking for a profit of 79 cents per share for the period, which ends July 31.

THOMSON WINS APPROVAL FOR REUTERS TAKEOVER

LONDON — Thomson won approval Tuesday for its $17.6 billion takeover of Reuters from the British company's editorial watchdog, but the deal now faces intense scrutiny from antitrust regulators and unions unhappy about expected job cuts.

The renamed Thomson-Reuters Corp. would reduce the number of major companies providing financial data, news and trading systems to the financial services industry from three to just two and vault it slightly ahead of the current market leader, privately held Bloomberg LP.

The backing of trustees of the Reuters Founders Share company was a crucial first step in creating the world's largest financial news provider. The trust, which controlled what is known as a "golden share," was set up when Reuters listed on the London Stock Exchange in 1984 to safeguard the editorial independence of its journalism.

CONSUMER INFLATION MODERATES A BIT

WASHINGTON — Consumer inflation moderated slightly in April even though motorists were socked with another big jump in gasoline prices. Outside of energy and food, inflation pressures remained well-contained.

The Labor Department reported Tuesday that consumer prices rose by 0.4 percent last month following a 0.6 percent jump in March.

The April increase was slightly lower than Wall Street had been expecting and investors were cheered because core inflation, which excludes volatile food and energy, edged up a slight 0.2 percent, the third month at this level or less after a worrisome 0.3 percent rise in January.

Wall Street investors agreed, believing the better-than-expected reading on inflation would hasten the day when the Federal Reserve might start cutting interest rates to deal with an economy that has been battered by a significant slump in housing.

DAIMLERCHRYSLER Q1 PROFITS RISE

FRANKFURT, Germany — First-quarter earnings at DaimlerChrysler AG more than doubled as a strong performance by the company's Mercedes division outweighed widening losses at Chrysler, which the company agreed this week to sell.

The German-American automaker said Tuesday it earned 1.97 billion euros ($2.67 billion) in the January-March period, up from 718 million euros a year earlier and well above the 1.39 billion euros ($1.88 billion) forecast of analysts polled by Dow Jones Newswires.

Sales fell to 35.4 billion euros ($47.96 billion) from 37.4 billion euros, below the 36.63 billion euros ($49.63 billion) analysts had expected.

Chief Financial Officer Bodo Uebber said the company, freed from the approximately $17.5 billion in health care and pension liabilities associated with Chrysler, would be in much stronger financial shape.

Shares of DaimlerChrysler rose 2.9 percent to close at 63.54 euros ($86.02), following on their 1.8 percent gain a day earlier as investors expressed relief that the company would soon be free of the billions in legacy costs.

LIMITED BRANDS SELLS MOST OF EXPRESS

COLUMBUS, Ohio — Limited Brands Inc. will sell a majority interest in its underperforming Express apparel brand and is considering options for its Limited Stores chain, the retailer said on Tuesday as it warned of first-quarter earnings likely to disappoint Wall Street.

Limited Brands, the operator of Victoria's Secret and Bath & Body Works, said it is selling 67 percent of its interest in Express to affiliates of private equity firm Golden Gate Capital for $548 million. The sale is expected to close by July.

There is no time frame for what Limited Brands will do with Limited Stores, which company founder Les Wexner used as the starting point for the specialty retailer when he opened his first store in 1963.

Wexner expanded the business to other retail brands in building a chain with 3,700 stores, but over the past six years, Limited has been selling its apparel divisions to focus on more profitable operations: lingerie and personal care products.

OPTIONS ON TABLE FOR WORLD BANK LEADERSHIP

WASHINGTON — The White House said Tuesday that "all options are on the table" about the leadership of the World Bank, even as it publicly defended embattled President Paul Wolfowitz as he fights conflict-of-interest charges.

Wolfowitz maintains that he acted in good faith in arranging a generous pay package for his girlfriend and is waging a vigorous fight to keep running the institution. He will appear before the bank's 24-member board late Tuesday. The board, whose proceedings are carried out behind closed doors, ultimately will decide what actions to take against him.

It was unclear whether this rhetorical shift signaled a weakening of support at the White House for Wolfowitz, or more of an attempt to calm European allies who are clamoring for him to step aside. Promising future conversations, and separating them from the process of determining Wolfowitz's fate based upon the pay package issue, could give those speaking against Wolfowitz the sense that their concerns will be addressed at some point.

HOME DEPOT PROFIT DIPS

ATLANTA — The Home Depot Inc. posted a 29.5 percent drop in first-quarter profit Tuesday and warned the rest of the year will be challenging. The company also said it still hasn't decided the fate of its wholesale distribution arm three months after announcing it might shed the unit.

Analysts were eager to get an update on the Atlanta-based company's review of whether it will sell, spin off or keep its HD Supply unit. But the world's largest home improvement store chain was mum on its plans.

Chief Financial Officer Carol Tome said in an interview that Home Depot has received inquiries from interested parties who wanted to talk about buying a piece or all of the supply unit. She would not say if there have been any formal offers, or name the interested parties.

HOME SALES LAG BEHIND LAST YEAR'S RATE

WASHINGTON — The pace of existing home sales slowed in the first quarter by almost 7 percent compared to a year ago, the National Association of Realtors said Tuesday.

In the latest indication of the housing market's slowdown, the NAR said home sales reached a 6.4 million annual rate compared to 6.9 million in the same quarter of 2006.

The report came on the same day that RealtyTrac Inc., an industry research firm, said mortgage lenders foreclosed on 62 percent more U.S. homes in April than a year ago.