BUSINESS BRIEFS
Oil prices spike over worries on bailout plan
Associated Press
NEW YORK — Oil prices briefly spiked more than $25 a barrel yesterday, shattering the record for the biggest one-day gain as unease about the government's $700 billion bailout plan pummeled the dollar and spur-red investors to buy safe-haven assets. An expiring crude contract added fuel to the frenzied rally.
Light, sweet crude for October delivery jumped as much as $25.45 to $130 a barrel on the New York Mercantile Exchange before falling back to settle at $120.92, up $16.37.
The contract expired at the end of the day, adding to the volatility as traders rushed to cover positions.
CREDIT MARKETS EASE A LITTLE BIT
NEW YORK — A few corners of the frozen credit markets thawed a bit yesterday on news of the U.S. government's bank bailout plans, but business was hardly back to normal.
Last week, the credit markets — where the world buys and sells debt — were thrown into a tumult after a cascade of troubling events, from the bankruptcy of Lehman Brothers Holdings Inc. to the bailout of insurer American International Group. Over the weekend, the U.S. government said it would buy $700 billion in mortgage debt and asset-backed commercial paper from the nation's struggling banks.
Although several credit market indicators improved yesterday compared with last week, they did not show restored confidence.
MICROSOFT PLANS $40B BUYBACK
SEATTLE — Chaos in the money markets gave Microsoft Corp. an opening yesterday to announce it would take on debt for the first time, launch a new $40 billion stock buyback plan and raise its dividend.
The company said yesterday its board approved a $2 billion commercial paper program, as part of a bigger $6 billion, open-ended allowance for debt financing.
Microsoft also raised its quarterly dividend to 13 cents from 11 cents, payable Dec. 11 to shareholders of record on Nov. 20.
Microsoft shares closed up 24 cents at $25.40 yesterday.
NIKE OPTS OUT OF SWIMSUIT MARKET
PORTLAND, Ore. — Nike said yesterday it is leaving the elite swimwear market.
The company will continue to provide swimwear for colleges and sell to traditional retail customers. But it will not compete against the likes of Speedo to get the swoosh on the world's top swimmers.
"We will not invest in next-generation swim innovation, which is not in line with our stated category growth strategy," the company said in a statement. Nike said it made a "strategic decision as part of the company's long-term growth plan."
Nike lost some of its edge at the games when Speedo stole the spotlight with its LZR Racer suit. According to Speedo, of the 77 world records set since the release of the suit in February, 72 have been in the LZR Racer. And it was worn by Olympics darling Michael Phelps.
CIRCUIT CITY CHAIRMAN RESIGNS
RICHMOND, Va. — The chief executive at Circuit City Stores Inc. stepped down yesterday and was replaced by a board member appointed to defuse a fierce proxy battle as the struggling electronics retailer steps up its turnaround effort.
Philip J. Schoonover, Circuit City's chief executive, chairman and president, had joined the company in 2004 from rival Best Buy Co., where he was executive vice president of customer segments.
The 48-year-old will be replaced by board member James A. Marcum, who will stand in as the chain's interim president and chief executive. Meanwhile, former tobacco executive Allen B. King will become Circuit City's new chairman.
"A change in leadership at the chief executive officer level is always a difficult decision, and Circuit City appreciates Phil's efforts over the past four years," King, 62, said in a statement.
