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WALL Street skidded yesterday after the assassination of Pakistani opposition leader Benazir Bhutto and after the Commerce Department's durable goods orders exacerbated concerns about the US economy. The major indexes each lost well over 1 percent and the Dow Jones industrial average fell 192 points. Bhutto's assassination raised the possibility of increasing political unrest abroad, always an unsettling prospect for investors who have already been contending with domestic economic concerns for months. Oil prices rose following the news, and that unwelcome inflationary trend only added to Wall Street's uneasiness. Meanwhile, the government said orders for durable goods, big-ticket items from commercial jetliners to home appliances, rose by just 0.1 percent last month. Economists had been looking for a rise of 2.2 percent. Still, November saw the first rise in durable goods orders in the last four months. The Labor Department said the number of workers seeking unemployment

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

OIL prices drifted higher in light holiday trading yesterday after predictions of a drop in crude inventories raised new supply concerns. With little other news to motivate buying or selling, investors focused on forecasts by analysts including Addison Armstrong, director of exchange traded markets at TFS Energy Futures LLC, who predicted crude inventories fell by 1.5 million barrels last week. Tim Evans, an analyst at Citigroup Inc, predicted that crude stocks fell by 2 million to 3 million barrels. The Energy Department's Energy Information Administration reports oil inventories on Thursday this week, a day late due to Christmas. Light, sweet crude for February delivery rose 82 cents to settle at US$94.13 a barrel on the New York Mercantile Exchange after falling as low as US$92.50 earlier. Prices rose more than US$2 on Friday after the government reported consumer spending jumped more than expected in November, raising hopes that the economy will weather the crisis roiling

GOVERNMENT subsidy support for meat production will be stable even when pork prices fluctuate, the Ministry of Finance said yesterday. Speaking at an online press conference, Zeng Xiao'an, deputy director of the MOF's Department of Economic Development, said the government would take subsidies for piglet keepers into a long-term mechanism framework. "It does not matter whether pork prices are rising or falling, the supportive policies will be successive," said Zeng. "We will only adjust the strength of the policies based on real conditions," Zeng said when asked about the policies' time limit. To combat escalating inflation, China pledged to draw up a series of measures, including more subsidies for farmers. From July next year to the end of June in 2009, subsidies for each reproductive female piglet will be raised from 50 yuan (US$6.75) to 100 yuan, said Zeng. Also, the central government will allocate 2.5 billion yuan next year to support the

SAN FRANCISCO (MarketWatch) -- Treasurys were slightly lower Monday, pushing up yields, as firm stock prices decreased the appeal of fixed-income assets in extremely thin pre-holiday trading. U.S. bond trading will end early on Monday, and overnight Japanese and German markets were closed Monday for holidays. "With the holiday-shortened week, our expectations for any paradigm shifting events are pretty light," said David Ader, U.S. government bond strategist at RBS Greenwich Capital. "With the bench players now in the field until the New Year, we would err on the side of limited conviction for any moves over the next few trading sessions." The benchmark 10-year Treasury note was down 7/32 at 100 12/32, with a yield of 4.2%. The 30-year bond was down 10/32 at 106 9/32 with a yield of 4.61%. The two-year note was down 2/32 at 99 26/32 with a yield of 3.21%. On Wednesday, the Treasury Department will sell $22 billion in two-year notes, and on Thursday, it will sell $13 billion in five-year notes.

OIL prices jumped in light trading yesterday after the government reported that consumer spending surged last month, raising hopes that the US economy will weather the crisis roiling credit markets and that demand for oil and gasoline will strengthen. The Commerce Department said consumer spending jumped 1.1 percent in November, the biggest one-month gain since 2004 and well above analyst expectations for an 0.7 percent increase. Light, sweet crude for February delivery rose US$2.25 to settle at US$93.31 a barrel on the New York Mercantile Exchange. Oil prices were also supported by stocks, which rose yesterday, and a slightly weaker dollar. Energy investors often view stock market moves as reflective of overall economic sentiment. Also, oil futures offer a hedge against a weak dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the greenback is falling. Many observers blame oil's rise last month to near US$100 on speculators

Reuters - U.S. personal spending jumped a much bigger-than-expected 1.1 percent in November, the sharpest rise in more than two years, while prices rose, a Commerce Department report showed on Friday.

WASHINGTON (Reuters) - U.S. personal spending jumped a much bigger-than-expected 1.1 percent in November, the sharpest rise in more than two years, while prices rose, a Commerce Department report showed on Friday.

The Justice Department has begun an inquiry into chocolate makers' pricing practices.

OVERALL consumer prices in Hong Kong rose 3.4 percent year on year in November, slightly higher than October's 3.2 percent, the Census and Statistics Department said yesterday. The larger increase was mainly attributed to higher costs for town gas, private housing rents, outdoor dining as well as package tours, a spokesman for the department said. The spokesman said forecast for inflation in 2007 remained unchanged at two percent, adding that the slightly higher increase in November had been taken into account in the outlook, which was announced in mid-November. Looking ahead, sustained economic expansion, high food and oil prices, the weak US dollar and the appreciation of the yuan would continue to exert pressures, he added. "Lately, the pick-up in private housing rents also deserved attention. Yet the sustained increase in labor productivity should help mitigate the pressures to some extent," he added. For the three-month period ended November, the average

CRUDE oil futures rose yesterday after the government said stocks of crude and heating oil fell sharply last week while gasoline inventories jumped. In its weekly inventory snapshot, the Energy Department's Energy Information Administration reported crude stocks dropped by 7.6 million barrels last week, much more than the 1.5 million barrel decline analysts surveyed by Dow Jones Newswires, on average, had expected. Much of the decline was due to a sharp drop in imports, almost a million barrels a day, because fog closed the Houston Ship Channel last week, said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois. "That's basically what drew crude supplies lower," Ritterbusch said. Traders expect crude supplies will rebound in next week's report, which will reflect deliveries that were delayed by the fog, Ritterbusch said. Meanwhile, investors were focusing on other aspects of the report, which were mixed. For instance, heating oil

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.

CONSUMER confidence is falling, the odds of a recession have risen, analysts predict the worst holiday shopping since 2002 - and retail-industry executives are buying their companies' shares like never before. Limited Brands Inc Chief Executive Officer Leslie Wexner and eight other executives bought a record amount of stock last month after prices fell to a four-year low. Dillard's Inc director Warren Stephens made the biggest insider purchase ever as shares of the Arkansas-based department store chain headed for the steepest decline since at least 1980. Cambiar Investors LLC, Royce & Associates LLC and Becker Capital Management Inc say insider buying foreshadows a rebound. The last four times executives added to their holdings, the Standard & Poor's Supercomposite Retailing Index rose an average 9.9 percent in the next three months, topping a 6.2-percent average rise in the S&P 500 Index. Retail company officials increased their investments by US$346.4 million since the start

THE difference in yield between Japanese and US 10-year bonds climbed last week to the widest in a month on signs inflation is a bigger threat in the United States than in Japan. The extra yield investors demand to hold Treasuries instead of Japanese notes climbed as high as 2.696 percentage points on Friday, after a Labor Department report showed the biggest increase in US producer prices in 34 years. Japan's bond yields rose less than US debt after confidence among the Asian nations' largest manufacturers slumped more than forecast, cementing speculation the Bank of Japan will delay raising interest rates. "JGBs are a better buy than Treasuries at the moment," Xinyi Lu, chief strategist at the international treasury division at Mizuho Corporate Bank Ltd in Tokyo, told Bloomberg News. "Nobody believes very firmly that there will be inflation here again." The yield on the 1.5-percent bond due December 2017 fell two basis points last week to 1.545 percent at

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

Consumer prices soared at the fastest pace in two years in November on red-hot energy costs, the Labor Department said Friday. That's the latest...

HOUSING prices in 70 major Chinese cities jumped by 10.5 percent in November, according to an official with the country's top economic planning body. The growth rate was the largest monthly rise since July 2005 when China started to cover more cities in its monthly housing price survey. From January to November, housing prices grew by 7.3 percent year on year, with the cost of new homes jumping 7.9 percent, Cao Changqing, director of the pricing department under the National Development and Reform Commission, said in an online interview. Rising property prices, driven up by speculation, have become a major concern for Chinese citizens. "Despite falling sales, housing prices in parts of Beijing, Shanghai, Guangzhou and Shenzhen still remain high," he said. Prices are expected to remain stable as macro-control policies are starting to yield results, Cao said. The government introduced a string of policies to cool off the red-hot real estate market.

Higher gas prices sent U.S. consumer inflation in November to its biggest jump since September 2005, the U.S. Labour Department said Friday.

NEW YORK (MarketWatch) -- The dollar strengthened against other major currencies early Friday, getting a boost after the Labor Department reported hotter-than-expected consumer price inflation for November. The dollar rose 0.7% against the yen at 113.07 yen. The euro gave up 1% at $1.4491. The dollar index, which tracks the performance of the greenback against a basket of other major currencies, rose 0.8% at 77.145. The consumer price index increased 0.8%, driven by a 5.7% gain in energy prices, the biggest gain in consumer prices in more than two years. Core inflation, which excludes food and energy prices, rose 0.3%, the biggest gain since January. The numbers were worse than expected. Economists were forecasting the CPI to rise 0.7% and the core rate to rise 0.2%, according to a survey conducted by MarketWatch.