30-year mortgage rate dips to 4.12%
WASHINGTON -- Average U.S. mortgage rates declined slightly this week, hovering near their lows for the year.
Mortgage company Freddie Mac said Thursday that the nationwide average for a 30-year loan slipped to 4.12 percent from 4.13 percent last week. The average for the 15-year mortgage, a popular choice for people who are refinancing, declined to 3.23 percent from 3.26 percent last week.
Mortgage rates are below the levels of a year ago. They have fallen in recent weeks after climbing last summer when the Federal Reserve began talking about reducing the monthly bond purchases it was making to keep long-term borrowing rates low.
To calculate average mortgage rates, Freddie Mac, the Federal Home Loan Mortgage Corp., surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was 0.6 point, unchanged from last week. The fee for a 15-year mortgage rose to 0.7 point from 0.6 point last week.
-- The Associated Press
Uneasy Target taps outsider as top exec
NEW YORK -- Target is bringing in an outsider as its chief executive for the first time.
The Minneapolis-based company said Thursday that it named PepsiCo executive Brian Cornell to the top spot, replacing Chief Financial Officer John Mulligan, who had been keeping the seat warm since May.
The announcement comes roughly three months after Target Chief Executive Officer Gregg Steinhafel resigned after a large data breach in the run-up to the Christmas-shopping season last year.
Steinhafel had been dealing with problems on a number of other fronts, too, including persistent perceptions that Target charges higher prices than its rivals and concerns that it had lost its magic touch for cheap chic offerings.
The company's expansion into Canada, its first foray outside the U.S., has also been a disappointment. Analysts have said that Target botched its Canadian expansion by moving too aggressively. The company opened about 120 stores in the latest year and lost nearly $1 billion in the Canadian business.
In May, it fired the president of its Canadian operations, Tony Fisher, and replaced him with Mark Schindele, a company veteran.
PepsiCo Inc., which is based in Purchase, N.Y., said in a statement it expects to announce Cornell's successor soon.
-- The Associated Press
Panasonic, Tesla plan U.S. battery plant
TOKYO -- American electric-car maker Tesla Motors Inc. is teaming up with Japanese electronics company Panasonic Corp. to build a battery manufacturing plant in the U.S. expected to create 6,500 jobs.
The companies announced the deal Thursday, but they did not say where in the U.S. the so-called gigafactory, or large-scale plant, will be built. Financial terms weren't disclosed for the $5 billion plant.
The plant will produce cells, modules and packs for Tesla's electric vehicles and for the stationary energy storage market, employing 6,500 people by 2020.
Under the agreement, Tesla, based in Palo Alto, Calif., will prepare, provide and manage the land and buildings, while Osaka-based Panasonic will manufacture and supply the lithium-ion battery cells and invest in equipment.
Tesla Chief Executive Officer Elon Musk has said the factory will help Tesla reduce its battery costs by 30 percent. Tesla needs cheaper batteries to produce its mass-market Model 3, an electric car it's developing that would cost around $30,000. Tesla hopes to have the Model 3 on the road by 2017. The company's only current vehicle, the Model S sedan, starts at $70,000.
-- The Associated Press
Venezuela seeks buyer for refiner Citgo
Petroleos de Venezuela is seeking a buyer for Citgo Petroleum, its U.S. refining and marketing company, in a deal that is said to be worth as much as $15 billion.
Petroleos de Venezuela , the state-owned oil company, "is currently seeking to monetize its ownership interest in us," Citgo said in a bond prospectus document released on Tuesday. "There can be no assurance as to whether a transaction will occur or as to the nature or timing of any potential transaction."
Citgo owns three refineries capable of handling about 749,000 barrels a day in Louisiana, Texas and Illinois. The company sells gasoline through 5,600 branded stations. It could fetch $15 billion because its midstream storage terminals and docks are eligible for tax advantages, said Sam Margolin, a New York-based analyst for Cowen & Co.
"Nobody should have a problem getting financing even up to that $15 billion level," Margolin said Thursday.
Potential buyers include both Gulf Coast refiners looking to capitalize on the region's rising crude supply and those operators seeking entry, Margolin said.
Citgo had sales of $42.3 billion last year and earnings before interest, taxes, depreciation and amortization of $1.8 billion. A call and email to Citgo's Houston office weren't immediately returned.
-- Bloomberg News
Judge to Kellogg: End Memphis lockout
MEMPHIS -- A judge has ordered the Kellogg Co. to put employees at its Memphis cereal production facility back to work.
The ruling on Wednesday came after the National Labor Relations Board filed a complaint in March against the company related to a lockout of about 220 employees.
The board said in its complaint that Kellogg violated the National Labor Relations Act by insisting on an impasse on bargaining proposals related to wages and benefits and by locking out the workers.
Contract negotiations between the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and Kellogg failed in October.
Media reported that U.S. District Judge Samuel Mays gave the Battle Creek, Mich.-based Kellogg five days to put the Memphis employees back to work with the same pay and working conditions that were in place when the lockout began.
"There is reasonable cause to believe that Kellogg has engaged in unfair labor practices and that the injunctive relief requested by Petitioner is just and proper," Mays wrote.
-- The Associated Press
Business on 08/01/2014