The GDP is up, Ebola is down, and the Fed ends speculation about its stimulus program. Read about these and more of the morning's top business news stories.
Jobless Claims Up 3,000 Last Week
In the week ending October 25, the advance figure for seasonally adjusted initial claims for unemployment benefits, an indication of layoffs, was 287,000, an increase of 3,000 from the previous week's revised level, the Labor Department reported Thursday. The 4-week moving average, a less volatile figure, was 281,000, a decrease of 250 from the previous week's revised average. The total number of people claiming benefits in all programs for the week ending October 11 was 2,061,139, a decrease of 12,366 from the previous week, and down from 3,899,605 persons claiming benefits in all programs in the comparable week last year.
Fed Ends QE
The federal government’s quantitative easing bond-buying program is now history. Noting improvements in the economy, the federal government announced Wednesday afternoon that it will no longer purchase bonds to keep the American economy afloat. However, the statement also said there will be no rise in interest rates for the foreseeable future, to keep the economy moving forward. The stock market reacted in a jittery fashion, dropping sharply initially, recovering soon thereafter, and then tumbling again at the close. By the end of the market day Wednesday, stocks were slightly lower with the Dow off 31 points at 16,974 and the S&P 500 down 2 at 1982.
GDP Up 3.5 Percent
The Commerce Department Thursday reported that gross domestic product grew at a 3.5 percent annual rate, well above economists’ expectations of a 3.0 percent gain. The smaller trade deficit and a surge in defense spending were responsible for the large jump, the Commerce Department said. Also contributing was a rise in business investment, housing and consumer spending. This was a deceleration from the fourth quarter report of a 4.6 percent rise, but it did mark the fourth time in the past five quarters the economy has expanded at or above a 3.5 percent rate.
Ebola Decline in Liberia
The World Health Organization Wednesday reported that there has been a decline in the outbreak of Ebola in Liberia, the country that has suffered the most cases of the deadly disease. However, WHO said the battle against the outbreak is not yet over. WHO Assistant Director General Bruce Aylward said the number of burials and new hospital admissions has fallen in recent weeks. "All the data point in the same direction," he told a news conference. "Do we feel confident that the response is now getting an upper hand on the virus? Yes, we are seeing slowing rate of new cases, very definitely." Jeremy Farrar, the director of the charitable foundation The Wellcome Trust, said he also has seen a decline in Ebola cases, but said the next few weeks will be critical to continuing the gains being made against the outbreak. “"We're going through a very, very important phase,’’ Farrar said. “For the first time during this epidemic I think we will look on the last week as the week we put in place the jigsaw puzzle that changes the epidemic."
Honeywell Sued by Government
Honeywell International has been sued by the U.S. Equal Employment Opportunity commission for imposing penalties on employees who refuse to undergo testing as part of the company’s wellness program. This marks the third time the federal agency has filed suit against a corporate wellness program, in which companies encourage healthier lifestyle habits of its employees. Honeywell employees currently face up to $4,000 fines each through surcharges and lost contributions to health plans if they or their spouses do not comply with the biometric testing done in the wellness program. According to the lawsuit, employees and spouses are screened for blood pressure, cholesterol, blood-sugar levels, waist circumference and nicotine. Honeywell had informed employees that testing was to occur from Oct 22-31, the lawsuit said. The government says the testing violates the Americans with Disabilities Act and Genetic Information Nondiscrimination Act.
Time Warner Losing Customers
Despite losing more residential video customers than expected, Time Warner Cable reported increased earnings and revenues in the third quarter. The company’s earnings rose to $1.86 per share from $1.69 per share one year ago, and revenue increased to $5.71 billion from $5.52 billion one year ago. But analysts had expected the cable company to post earnings of $1.90 per share. Time Warner lost 184,000 residential customers in the quarter.
Microsoft Enters Wearable Exercise Game
Microsoft Thursday announced the launch of The Microsoft Band, which will allow users to monitor their fitness and exercise efforts. It is the first effort for Microsoft in the wearable technology market. The wrist-worn device has sensors that monitor pulse rate, calorie burn and track sleep quality. Microsoft says the device will sell for $199 and be available in limited quality Thursday. Microsoft also announced a health app called “Microsoft Health’’ that includes a cloud service for users to store their health and fitness data.