Increases in spending point momentum in the market\nWASHINGTON -- America's consumers, aided by tax cuts that left them with extra cash, ratcheted up their spending in July by the largest amount in four months, a strong signal the economy is gaining momentum. The Commerce Department reported Friday that consumer spending increased by 0.8 percent in July, on top of a brisk 0.6 percent rise the month before.\nConsumers' behavior is a major factor shaping the economy's recovery because their spending accounts for roughly two-thirds of all economic activity in the country.\nTheir hearty appetite to spend in July along with economists' expectations for solid spending increases in August reinforced the belief that the economy will stage a material rebound in the second half of this year.
J.P. Morgan Chase to lead bank consortium in Iraq\nWASHINGTON -- An international consortium of financial institutions led by J.P. Morgan Chase & Co. will run a trade bank aimed at helping the Iraqi government make big-ticket purchases from other countries, U.S. authorities involved in rebuilding Iraq announced Friday.\nThe new Trade Bank of Iraq may be operating by the end of September, said Peter McPherson, director of economic development for the Coalition Provisional Authority, which oversees rebuilding the war-torn country. The trade bank is needed because of the phasing out of the United Nations oil-for-food program, which has handled Iraq's major purchases abroad, McPherson said.
Kmart shares rise; losses smaller than expected\nDETROIT -- Kmart Corp. shares were up more than 4 percent Friday after the retailer showed a smaller loss in its first earnings report since exiting bankruptcy, although sales deteriorated. The discount retailer reported Thursday that its second-quarter loss narrowed to $5 million, or 6 cents a share, from $293 million, or 58 cents a share, a year ago. Excluding interest, reorganization costs, income taxes and discontinued operations, Kmart said it would have posted an $8 million profit, compared with a loss of $264 million in the second quarter of last year. Sales fell to $5.65 billion, down 21.3 percent from $7.18 billion a year earlier.
PLEASANTON, Calif. -- Business software maker PeopleSoft Inc. announced the completion of its $1.8 billion acquisition Friday of rival J.D. Edwards by buying the few remaining shares that it didn't already own.\nThe move was a formality -- Pleasanton-based PeopleSoft took control of Denver-based J.D. Edwards on July 18 after accumulating an 88 percent stake in the company. The takeover creates the world's second-largest maker of business applications software behind industry leader SAP of Germany. Redwood Shores-based Oracle Corp. is trying to seize the No. 2 position by buying PeopleSoft in a $7.5 billion hostile takeover.
LONDON -- British energy group BP PLC said Friday it has completed the biggest foreign direct investment ever in post-Communist Russia -- a $7.7 billion deal that gives BP a 50 percent share in a major new Russian energy company.\nBP signed an agreement late Thursday with its Russian partners -- Alfa Group and Access-Renova -- to combine their interests in Russia to create a new business with 5.2 billion barrels in proven oil reserves and daily crude production of 1.2 million barrels. Upon final regulatory approval, the new company, TNK-BP, would be Russia's third-largest energy concern, with stakes in five refineries and 2,100 retail outlets, BP said.\nThe agreement is a strategic bet on the future of Russia's vast wealth of oil and gas and comes four years after BP almost abandoned that country following a commercial dispute.
SAN JOSE, Calif. -- Demand for server computers that feed big companies' networks made a double-digit improvement in the second quarter, reversing a nine-quarter slide and allowing IBM Corp. to surpass Hewlett-Packard Co. as the top seller.\nAccording to research group IDC, manufacturers such as IBM, Hewlett Packard, Dell Computer Corp. and Sun Microsystems Inc. shipped 1.2 million servers worldwide during the second quarter, up 17.5 percent from the same period last year. But the category's revenue of $10.6 billion worldwide in the second quarter was only a 0.2 percent increase, according to the closely watched quarterly report from Framingham, Mass.-based IDC. That made it difficult for researchers to declare the beginning of a server market rebound or even increased optimism among technology-purchasing executives.
HOPKINS, Minn. -- A high school senior arrested Friday for allegedly launching a worldwide computer virus is a loner who drives too fast, neighbors said. Bill McKittrick called 18-year-old Jeffrey Lee Parson "a computer genius," but not a criminal. Parson, known online as "teekid," was arrested Friday. Court papers said FBI and Secret Service agents searched Parson's Hopkins home on Aug. 19 and seized seven computers, which are still being analyzed.
HELSINKI, Finland -- Motorola Inc. is selling its stake in Symbian Ltd., a maker of operating systems for "smart phone" devices that combine the features of cell phones and handheld computers, to Nokia Corp. and Psion PLC. Financial terms of the deal were not disclosed. Motorola had a 19 percent stake in Symbian, a joint venture started in 1998 and owned by Nokia, Psion, Motorola, Sony Ericsson, Siemens, Samsung and Matsushita. Symbian is the top competitor for Microsoft Corp. in the smart phone software market.\nFinland-based Nokia's stake in Symbian will increase to 32 percent from 19 percent, and London-based Psion's stake will rise to 31 percent from 25 percent.
