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Tuesday, Dec 11, 2012 10:45 PM UTC

Business Highlights

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US defends $1.9 billion deal with British banking giant

NEW YORK (AP) — American authorities on Tuesday cited “astonishing” dysfunction at the British bank HSBC and said that it had helped Mexican drug traffickers, Iran, Libya and others under U.S. suspicion or sanction to move money around the world.

HSBC agreed to pay $1.9 billion, the largest penalty ever imposed on a bank.

The U.S. stopped short of charging executives, citing the bank’s immediate, full cooperation and the damage that an assault on the company might cause on economies and individuals, including thousands who would lose jobs if the bank collapsed.

Outside experts said it was evidence that a doctrine of “too big to fail,” or at least “too big to prosecute,” was alive and well four years after the financial crisis.

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Delta buys 49 percent stake in Virgin Atlantic

Delta Air Lines said it will buy almost half of Virgin Atlantic for $360 million as it tries to catch up to rivals in the lucrative New York-to-London travel market.

Delta plans to form a joint venture with Virgin Atlantic to sell seats on each other’s flights, share the costs and profits, and set flight schedules in ways that help both airlines. American Airlines has a similar deal with British Airways.

Because Delta would be setting fares and schedules in coordination with an airline it used to compete with, it said it will need antitrust approval from U.S. and European regulators. Delta said the share purchase of Virgin Atlantic will happen without antitrust approval.

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Exxon: US energy revival has staying power

NEW YORK (AP) — Exxon says the energy renaissance in the U.S. will continue and predicts that North America will become a net exporter of oil and natural gas by the middle of the next decade.

The company’s annual long-term energy outlook, released Tuesday, says the rapid growth of production in the U.S. and Canada, along with improved energy efficiency, will lead to more oil and natural gas sent overseas.

Exxon Mobil Corp.’s annual outlook is noted by investors and policymakers, and the company says its conclusions shape its decisions about where to invest. The main conclusions dovetail with recent forecasts from the U.S. government and others.

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Fiscal cliff: Private bargaining, public wrangling

WASHINGTON (AP) — In a test of a divided government, the White House and congressional Republicans bargained in secret and sparred in public Tuesday over a deal to prevent year-end tax increases for middle class millions and spending cuts across much of the nation.

Officials disclosed that President Barack Obama and House Speaker John Boehner had exchanged at least partial proposals in the past two days, although details were sparse and evidence of significant progress scarcer still.

The White House swiftly detailed numerous proposals Obama has made to cut spending. And House Democratic leader Rep. Nancy Pelosi challenged Boehner to allow a vote on the president’s proposal to extend most expiring tax cuts while letting them lapse for higher-income earners.

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US wholesalers boost stockpiles in October

WASHINGTON (AP) — U.S. wholesale businesses increased their stockpiles in October but sales fell sharply, a mixed sign about economic growth.

The Commerce Department said Tuesday that stockpiles grew 0.6 percent in October. That’s slower than September’s 1.1 percent increase, which was the biggest gain in nine months. Sales in October fell 1.2 percent, after rising 1.9 percent in September.

With the October increase, wholesale inventories grew to $497.1 billion. That’s 29.2 percent above the post-recession low hit in September 2009.

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US employers advertise more jobs in October

WASHINGTON (AP) — U.S. employers advertised more jobs in October than September, a hopeful sign that hiring would pick up in the coming months.

The Labor Department said Tuesday that job openings rose by 128,000 to 3.68 million. That’s the most since June.

The number of available jobs is slowly climbing back to the roughly 4 million that were advertised each month before the recession began in December 2007.

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Treasury sells remaining shares of AIG

WASHINGTON (AP) — The Treasury Department said Tuesday that it has sold all of its remaining shares of American International Group Inc., moving to wrap up the government’s biggest bailout of the 2008 financial crisis.

Treasury said it received $32.50 per share for its 234.2 million remaining shares, which represented a 16 percent ownership stake in the giant insurance company.

With this sale, Treasury said the government has received $22.7 billion more than the $182 billion bailout it provided to support AIG during the height of the financial crisis.

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Sandy pushes airlines’ on-time rate lower

The on-time record of U.S. airlines got soaked by Superstorm Sandy, as late flights and cancelations surged in October.

The Department of Transportation said Tuesday that only 80.2 percent of flights in October arrived on time. That was worse than the 83.3 percent mark in September and the 85.5 percent rate in October 2011.

American Airlines had the worst on-time record for the second straight month, while Hawaiian Airlines held on to its usual perch on top of the government rankings.

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Microsoft increases Surface tablet production

NEW YORK (AP) — Microsoft says it’s increasing production of its Surface tablets and will sell them in more stores. Staples says it will carry them starting Wednesday.

Surface is the first tablet Microsoft is selling under its own brand, and the company has promoted it heavily since its late-October launch. Reviews have been mixed, and there have been few signs that the tablet is flying off the shelves. Microsoft has been selling it online and through its own stores.

Microsoft says other stores in the U.S. and Australia will now carry Surface, and more countries will be added within months. Microsoft’s holiday stores will keep operating into the new year

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Yahoo revamps email in bid to catch up with Gmail

SAN FRANCISCO (AP) — Yahoo is spiffing up and expanding its email service in an attempt to regain some of the ground lost to a Google alternative that lured away millions of users.

The changes unveiled Tuesday are meant to make Yahoo’s email faster and easier to use on the Web. To cater to the growing audience checking their email on smartphones and tablet computers, Yahoo also introduced mobile apps for the iPhone, iPad and devices powered by Microsoft Corp.’s recently released Windows 8 system.

The company, based in Sunnyvale, Calif., also updated its email app designed for Google Inc.’s Android operating system.

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By The Associated Press(equals)

The Dow Jones industrial average gained 78.56 points to 13,248.44. The S&P 500 finished up 9.29 points at 1,427.84. The Nasdaq composite ended up 35.34 points at 3,022.30.

Benchmark oil rose 23 cents to finish at $85.79 per barrel in New York. Brent crude, used to price international varieties of oil, rose 68 cents to end at $108.01 per barrel in London.

Heating oil rose 3 cents to finish at $2.93 per gallon. Wholesale gasoline rose 1 cent to end at $2.61 per gallon. Natural gas fell 5 cents to finish at $3.41 per 1,000 cubic feet.

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