Business news with words department+prices+world. 15 news.

CRUDE oil futures jumped yesterday on supply concerns, stoked by a new round of Turkish airstrikes in northern Iraq and a growing belief that US oil inventories fell last week. Turkey's military said its warplanes bombed eight suspected Kurdish rebel positions in northern Iraq on Wednesday. It was the third Turkish strike inside Iraq in less than two weeks. Iraq produced 2.32 million barrels of oil a day in November, according to the International Energy Agency, or about 2.7 percent of the world's oil supply. As much as 400,000 barrels a day is exported north across Iraq's border with Turkey, and the air assaults raise the risk of retaliatory strikes against oil infrastructure, analysts said. "People are nervous about a possible disruption of supply on some important pipelines" in the area, Mike Fitzpatrick, an analyst at MF Global in New York, told Dow Jones Newswires. The new attacks came as oil investors awaited inventory data from the Energy Department's

Wheat prices surged above $10 a bushel for the first time Monday amid concerns that strong demand globally could result in a grain shortage in the United States next year -- worsening food price inflation. Wheat supplies in the U.S. have dwindled this year as one wheat crop after another around the world has been damaged by poor weather, most recently in Australia and Argentina. That's sent buyers scrambling for stockpiles at any cost. U.S. wheat exporters already have sold more than 90 percent of the 1.175 billion bushels the U.S. Department of Agriculture expects will be exported during the whole marketing year, which ends in June 2008. Kansas wheat producers likely won't benefit much from the spike, as most of last year's crop has already been sold, said Marsha Boswell, a spokeswoman for Kansas Wheat. "Last year during harvest, we had flooding and also freeze damage in April, so there was a lot of wheat we were not able to harvest," she said. "So there's not a lot of wheat left in the state to be sold at that price right now." However, the higher bushel price is good news for farmers looking ahead to futures pricing for next year's harvest.

STOCKS sold off yesterday after a jump in consumer inflation raised concerns about how much freedom the Federal Reserve has to continue cutting interest rates. The Dow Jones industrial average gave up more than 178 points. The Labor Department said the consumer price index rose 0.8 percent in November amid a spike in gasoline prices. The report also found large increases in the cost of clothing, airline tickets and prescription drugs. The report raises questions about the Fed's options for priming the economy. The Fed this week lowered interest rates and announced a plan to align with other key central banks and offer loans to pressed lenders around the world. But while it wants to stimulate the U.S. economy and make lending easier among banks wary of faltering debt, the Fed also has to keep a watchful eye on inflation. Robert Dye, senior economist at PNC Financial Services Group, said the economic readings this week painted a mixed picture for investors, spurring some of the

CORN fell the most last week on speculation that higher supplies in China, the world's largest consumer of the grain, will cut demand for imports. China will produce 145 million metric tons of corn this season, up from 143 million estimated in October, the US Department of Agriculture said in a report on Friday. That would push the country's reserves to 28.1 million tons before the next harvest, up from 25.7 million estimated a month ago. Still, the stocks would 14 percent off from the previous year, Bloomberg News said. "The trade is unlikely to think that the Chinese are going to import corn anytime soon," said Mike Zuzolo, president of Risk Management Commodities Inc in Lafayette, Indiana. Speculation that China would become a net importer of corn for the first time in 12 years helped push corn prices up 12 percent in the past two months, he said. Corn futures for December delivery fell 2.75 cents, or 0.7 percent, to US$3.8675 a bushel on the Chicago Board of Trade,

WAL-MART Stores Inc will reduce its employees in China by more than 100 as part of a restructuring program in its Global Procurement Division after pressure mounted on the firm due to slower profit growth. The world's biggest retailer plans to cut the payroll in its four sourcing offices in Shenzhen, Shanghai, Putian and Dongguan, according to Huang Jianling, a communications official from Wal-Mart China. The lost jobs in China account for half of its global reduction. "We have found some department functions overlap," said Huang via telephone with Shanghai Daily. "The consolidation will help to reduce redundancy and improve efficiency." Huang added that some new positions will be created, but did not elaborate. The layoffs in China, announced last weekend, came after the retailer posted a less-than-anticipated profit for the second quarter. Wal-Mart also lowered its earnings forecast after cutting prices on thousands of stationary items. "The

World oil prices aimed higher Wednesday after shedding around US$3 the previous day on profit-taking as traders bet on rising energy reserves in the United States. Later Wednesday, the U.S. Department of Energy (DoE) publishes its weekly snapshot of American crude oil inventories at 1430 GMT.

OIL prices surged as high as US$86 a barrel yesterday for the first time after OPEC said crude production by non-member countries is likely falling even as global demand for oil is rising. Prices were also supported by concerns that Turkish forces will pursue Kurdish rebels into Iraq, disrupting oil supplies, and by technical buying by investment funds. Despite the Organization of Petroleum Exporting Countries' decision last month to boost its production by 500,000 barrels per day beginning next month, the rest of the world will likely produce 110,000 fewer barrels of oil per day than expected in the fourth quarter, OPEC said in a report. At the same time, fourth quarter demand for crude oil will grow by 100,000 barrels a day over last year, OPEC said. The estimates add to sentiment that crude supplies are tight. Last week, the Energy Department reported that domestic crude inventories fell during the week ended October 5 when they had been expected to rise. And the

US stocks rose for a fifth straight week, the longest stretch of gains since May, after minutes from the Federal Reserve and better-than-expected retail sales bolstered hopes that the economy will keep expanding. Wal-Mart Stores Inc, the world's largest retailer, climbed to a two-month high after boosting its third-quarter profit forecast. Yum! Brands Inc, owner of the Pizza Hut and Taco Bell restaurant chains, jumped the most since September 2005 on earnings that topped analysts' estimates. Exxon Mobil Corp, the biggest oil company, led a gauge of energy shares to a record after crude prices rose to an all-time high. Minutes from the Fed's September 18 policy meeting showed central bankers avoided language that might have suggested the economy would fall into a recession. The Commerce Department said retail sales added 0.6 percent last month, from the 0.2 percent gain predicted by analysts in a Bloomberg News survey. "The consumer is a staying force, earnings growth is

PETROLEUM futures rose sharply yesterday and oil prices passed US$83 a barrel after the US government reported an unexpected decline in crude oil inventories. Prices were also supported by an International Energy Agency report that concluded oil inventories held by the world's largest industrialized countries have fallen below a five-year average, and by concerns that clashes between Turkish forces and Kurdish rebels could affect Iraqi oil supplies. "No news was bearish today," said James Cordier, president of Liberty Trading Group in Florida. "Really, that's all investors need right now to push energy prices higher." The weekly inventory report from the US Energy Department's Energy Information Administration said crude supplies fell by 1.7 million barrels in the week ended October 5. Analysts surveyed by Dow Jones Newswires on average expected oil inventories to rise by 1 million barrels. While the report also concluded that refinery activity and

ASIAN stocks gained, led by Japanese exporters, after the yen reached a two-month low against the US dollar. BHP Billiton Ltd and Inpex Holdings Ltd fell after oil and copper prices extended their biggest drops in seven weeks. Honda Motor Co, which gets more than half of its sales from North America, climbed to an eight-week high. The Nikkei 225 Stock Average rose as Japan's market, which was closed on Monday, caught up with a rally fueled by a pickup in US hiring. "The improving US outlook has prompted a strengthening in the dollar; that's positive for exporters," said Yoji Takeda, who helps manage about US$900 million at RBC Investment (Asia) Ltd in Hong Kong. Benchmarks in Australia, South Korea, Singapore and Pakistan climbed to records while those in Hong Kong, India, Malaysia, Thailand and Pakistan also rose. They fell elsewhere in the region. The Morgan Stanley Capital International Asia-Pacific Index rose 0.2 percent to 166.04 as of 4:30pm in Tokyo, after earlier gaining as much as 0.5 percent. A measure of materials producers was the biggest drag on the index. "We've seen some weakening in commodity prices over the past few days and that's being reflected in the related stocks," Takeda said. The Nikkei 225 added 0.6 percent to 17,159.90. KK DaVinci Advisors led real estate-related shares higher after Goldman Sachs Group Inc offered to buy Simplex Investment Advisors Inc. US stocks slid on Monday, sending the Standard & Poor's 500 Index 0.3 percent lower. The index rose to a record on Friday after the Labor Department said the number of jobs in the country rose by 110,000 last month, more than the 100,000 additions forecast by economists in a Bloomberg News survey. "Concern about a slowdown in the US economy is easing," said Fujio Ando, who helps oversee US$365 million at Chiba-Gin Asset Management in Tokyo. "The strong jobs data also spurred dollar-buying. That's also positive for Japanese exporters." The yen recently traded at 117.35 per US dollar, compared with 116.59 at the market close on Friday in Tokyo. A weaker yen boosts the value of exporters' dollar-denominated sales when converted into the Japanese currency. Honda rose one percent to 4,020 yen (US$34.28), set for the highest close since August 15. Sony Corp, the maker of the Vaio computer and the PlayStation game console, added 0.5 percent to 5,820 yen. BHP, the world's largest mining company, fell 0.7 percent to A$44.40 (US

THE biggest quarterly rally for US government securities in five years is getting an extraordinary boost from the burgeoning reinvestment of petrodollars by the Organization of Petroleum Exporting Countries. OPEC members increased their holdings of Treasuries 12 percent this year through July to US$123.8 billion, Treasury Department data show. The prospect that OPEC's share of US debt is growing is based on the 31 percent rise in oil since December, which will raise OPEC revenue four percent to US$630 billion this year and nine percent to US$688 billion in 2008, according to estimates by the US Department of Energy. Petroleum exporters are adding to holdings of US debt three times faster than other foreign investors, the Treasury data show. Yields on 10-year notes are 21 basis points lower because of the additional petrodollar reinvestment, New York-based consulting company McKinsey & Co said last week. "Oil revenues are up; they're still in dollars, and they have to be put to work," said David Ader, head of US government bond strategy in Greenwich, Connecticut, at RBS Greenwich Capital, one of the 21 primary dealers that underwrite US government debt. "It bodes well for US debt." Demand from oil exporters may help drive yields lower even as signs that the US economy is weathering the worst housing market in 16 years reduce investor expectations for lower interest rates. The chances that the Federal Reserve will lower its target rate for overnight loans between banks this month fell to 48 percent from 74 percent a week ago, based on prices at the Chicago Board of Trade. The yield on the benchmark 4 3/4 percent note due in August 2017 rose four basis points last week to 4.64 percent, according to New York-based bond broker Cantor Fitzgerald LP. The price, which moves inversely to the yield, fell 10/32, or US$3.13 per US$1,000 face amount, to 100 7/8. A basis point is 0.01 percentage point. The note was little changed at 4.63 percent yesterday. OPEC's windfall suggests there will be demand for US debt from international investors even as the dollar falls to a record low versus the euro, Michael Pond, a debt strategist at Barclays Capital Inc, told Bloomberg News. Among foreign holders only Japan, China and the United Kingdom own more Treasuries than the 12 members of OPEC, which supplies more than 40 percent of the world's crude. Oil exporters eclipsed Asian nations last year as the biggest source of global capital for t

A SERIES of international sports events helped boost Shanghai's retail sales by a fifth during last week's National Day holiday, the city's economic commission said yesterday. Sales generated by the 425 retailers surveyed jumped 20.5 percent to 5.1 billion yuan (US$680 million) between October 1 and 7 from the same period last year, the Shanghai Economic Commission said in a report. The growth rate was 3.7 percentage points higher than the pace registered during the Labor Day holiday in May and 6.1 percentage points higher than February's Spring Festival. Chen Yuxian, author of the report, attributed the Golden Week spending boom partly to the FIFA Women's World Cup soccer championship, the Special Olympics and the Formula One Chinese Grand Prix, which all brought large numbers of athletes and sports fans to town. "Several local shopping and tourism events coincided with the holiday, plus the good weather also pushed up sales," Chen said. Hundreds of theme events were held citywide as part of the Shanghai Shopping Festival, including the Luwan District's imported food show, an international shopping carnival in Jing'an District, Huangpu's jewelry fete and a wine-tasting gala in Hongkou District. Hypermarkets, supermarkets and convenience stores were the leading contributors to the consumption boom, accounting for 41.2 percent of the total retail sales, the report said. Sales in department stores and shopping malls also rose. But sales in the restaurant sector fell 16.4 percent to 137.8 million yuan from the same period a year earlier, and receipts for hotels and related service businesses dropped 3.2 percent to 97.2 million yuan, the report said, without stating a reason. Local retail powerhouse Shanghai Brilliance (Group) Co generated 1.69 billion yuan in sales over the weeklong holiday, up 20.7 percent year on year and topping the eight major business groups surveyed by the commission. Meanwhile, retail sales in the suburbs totaled 763 million yuan, up 16.6 percent, led by Nanhui, Songjiang, Jinshan, Qingpu and Baoshan districts, which reported a rise of more than 25 percent. The report also said food prices remained stable during the holiday, with meat prices falling from the pre-holiday period while prices of green-leaf vegetables were up slightly.

CRUDE oil may decline on speculation that near-record prices are unjustified because of rising US inventories and increased OPEC output. Twenty-three of 32 analysts surveyed, or 72 percent, said oil prices will fall from October 5, the most bearish response since the survey began in April 2004, Bloomberg News reported. Five, or 16 percent, said prices will increase and four said there will be little change. Last week, 59 percent of respondents said prices would fall. US crude-oil inventories rose 1.84 million barrels in a week, the Energy Department said in a report on September 26. The gain left supplies 8.5 percent higher than the five-year average for the period, the department said. Stockpiles at Cushing, Oklahoma, where New York-traded West Texas Intermediate oil is delivered, dropped 209,000 barrels, the report said. "While the market may be vulnerable to a squeeze based on low physical inventories at Cushing, Oklahoma, overall US commercial crude-oil stocks are comfortably above their five-year average," said Tim Evans, an analyst with Citigroup Global Markets Inc in New York. "It also looks like OPEC production is rising and the fourth-quarter demand may be revised lower." The Organization of Petroleum Exporting Countries agreed on September 11 to produce an extra 500,000 barrels a day starting in November. World oil demand peaks in the fourth quarter when refiners make heating fuel for the Northern Hemisphere winter. Crude oil for November delivery rose four cents to US$81.66 a barrel last week on the New York Mercantile Exchange. Friday's close was the second-highest since trading began in 1983.

WASHINGTON (MarketWatch) - The value of U.S. exports of goods and services to the rest of the world increased 2.7% in July, the fastest seasonally adjusted growth in more than three years, the Commerce Department reported Tuesday. With imports growing 1.8%, the deficit between imports and exports narrowed by 0.3% to $59.2 billion in July from an upwardly revised $59.4 billion in June, close to expectations. Both exports and imports were at record levels in July, reflecting strong global demand and higher prices. U.S. producers exported record values of capital goods, consumer goods, autos, and foods. U.S. consumers imported record values of foods and feeds. The trade gap with China was the second highest ever.

The world is hungry for information, as well as grain THE long cycles of agriculture are seldom associated with gripping suspense. But on September 12th farmers, grain traders and investment managers around the world will be awaiting news that is generating greater excitement the higher grain prices rise. The monthly report of America's Department of Agriculture (USDA) is so sensitive that department staff go into what they call a "lockup" period for days in advance, often working all night just before its release. Prices of global wheat futures hit records during the first week in September, about double what they were a year ago. Corn (maize) prices have also surged. Consumers are already paying higher prices, forking out more money for products ranging from bread to noodles--although the cost of something in the shops has many components in addition to the price of a commodity. Wheat, for instance, accounts for only about 5% of the cost of an average loaf of bread. But although a jumble of subsidies clouds the precise picture, a long period of higher food prices is beginning to show up in inflation numbers around the world.