BUSINESS BRIEFS
Manufacturing reading points to contraction
Advertiser news services
NEW YORK — For the nation's lumber companies, automakers, home builders and other manufacturers, the final half of 2008 may be as sluggish as the first.
Slow consumer spending and high gas prices have stalled manufacturing, and even some bright spots are expected to dim. Exports, which have propped up the sector, may slide as economies overseas slow.
The Institute for Supply Management said yesterday its reading for the nation's manufacturers fell to 49.9 in August from 50 in July, matching economists' expectations, according to Thomson/IFR. A reading below 50 signals contraction, while a reading above 50 signals growth.
DEBT SALE LOWERS FREDDIE MAC FEARS
WASHINGTON — Freddie Mac sold $1 billion in five-year debt yesterday at a price that indicates investors' fears about the mortgage finance company's future have eased a bit.
Investors are watching the debt sales of Freddie Mac and its sibling company, Fannie Mae, to gauge whether they are having problems funding their operations without government support. The companies' ability to sell debt last week diminished the sense of urgency about the two companies' future that seized Wall Street for much of last month.
Freddie Mac's five-year debt sold through an auction yesterday will pay a yield of nearly 3.98 percent, or almost 0.96 of a percentage point above comparable Treasury notes. That gap — or spread —was narrower than the company paid last month in a $3 billion offering of five-year notes, which was priced at 1.13 percentage points above comparable Treasury securities.
KDB SEEKING STAKE IN LEHMAN
SEOUL, South Korea — State-owned Korea Development Bank has made a proposal to acquire 25 percent of U.S. investment bank Lehman Brothers for as much as $5.3 billion, a newspaper reported today.
The Chosun Ilbo, South Korea's largest mass-circulation daily, reported that KDB said in the proposal that it would buy the stake by forming a consortium with other South Korean banks and is awaiting a response from Lehman.
The paper quoted a financial source it did not identify. KDB, which was South Korea's sixth-largest bank by assets as of the end of last year, said it had no comment on the report.
TATA HALTS WORK AT NANO FACTORY
MUMBAI, India — Tata Motors suspended work indefinitely at a factory building the world's cheapest car, the company said yesterday, after increasingly violent protests by farmers demanding the return of their land.
No one has reported to work at the West Bengal Nano factory since Friday, at the company's request, and some international staffers have gone home, the company said.
The conflict pits several thousand of the world's poor against one of India's richest men, Ratan Tata, who wants to build cars for them.
At $2,500, the Nano has knocked the bottom out of the mini-car market in India, with other automotive players pushing to enter the super-economy market.
VYTORIN-CANCER LINK NOT RULED OUT
MUNICH, Germany — Results so far from three studies of the cholesterol-lowering drug Vytorin are not enough to prove or rule out a possible link to a higher risk of cancer, so the drug should be used with caution until more is known, editors of a leading medical journal urged yesterday.
The New England Journal of Medicine published results online from one study and an analysis of partial results from two others. They also were presented at a cardiology conference in Munich.
Vytorin is a combination of Merck's Zocor, a long-sold statin drug, and Schering-Plough's Zetia, a newer type of medicine that lowers cholesterol in a different way.
