NEW YORK — The U.S. service sector grew in September for the first time in 13 months, an encouraging sign for the fledgling economic recovery, although jobs remain scarce.

The Institute for Supply Management said yesterday that its service index hit 50.9 last month, up from 48.4 in August. Analysts polled by Thomson Reuters had expected a reading of 50, the dividing line between growth and contraction.

The index, which tracks more than 80 percent of the country's economic activity, including hospitals, retailers, financial services companies and truckers, hadn't grown since August 2008.

BANK TO CHOOSE EMERGENCY CEO

CHARLOTTE, N.C. — Bank of America Corp. plans to select an emergency CEO this week in case Ken Lewis steps down before the end of the year, The Wall Street Journal reported yesterday.

Last week, the bank said Lewis plans to retire Dec. 31. Bank of America's board has created a six-member committee of directors to find Lewis' successor.

But the planning for an emergency replacement for Lewis, who faces possible legal problems over the bank's acquisition of Merrill Lynch & Co., started before the bank announced Lewis' retirement, the Journal reported, citing a person familiar with the matter.

CHRYSLER CEO RESHUFFLES TEAM

DETROIT — With sales down sharply and pressure to start generating cash before government loans run out, Chrysler CEO Sergio Marchionne shook up his executive team yesterday, replacing two of his brand managers after just four months and splitting Dodge into car and truck units.

The changes show Marchionne's penchant for moving quickly and demanding performance, industry analysts say.

But it's also a sign that all is not well inside the company's sprawling headquarters complex in the Detroit suburb of Auburn Hills.

GOURMET, 3 OTHERS TO CEASE PUBLICATION

NEW YORK — Conde Nast Publications is closing Gourmet, the nation's oldest food magazine, and three other money-losing titles as the high-end publisher tries to weather a devastating advertising slump.

In addition to Gourmet, which had a circulation of 980,000 last year, the publisher is closing Modern Bride, Elegant Bride and Cookie, a parenting magazine.

Earlier in the year it killed publication of Portfolio, a business magazine, and Domino, a lifestyle title.

COACH SUES TARGET OVER HANDBAG DESIGN

NEW YORK — Coach Inc. is suing low-price retailer Target Corp. over bags the luxury handbag maker says too closely resemble its own designs.

Coach wants Target to stop selling the bags and pay an undetermined amount in damages, injunctive relief and attorney fees, the New York-based company said in a complaint it filed Thursday in U.S. District Court in Manhattan.

The bags in question resemble Coach's Ergo bags, launched in 2008 and marketed as ergonomically correct, and its Signature Patchwork bags, which have patches in different fabrics and also were introduced in 2008, Coach said.

Target began selling handbags this summer with "exact and/or confusingly similar reproductions of Coach's Ergo designs and Signature Patchwork designs," Coach claims.