Investors bet on reformulated News Corp post-BSkyB

LOS ANGELES (AP) — increased News Corp. stock on Wednesday after the media company said it is dropping its $ 12 billion bid for British Sky Broadcasting. Investors returned their focus to the company's balance ballooning, with hopes that it will spread the ownership of all of its U.K. newspapers when the company is trying to contain damage from a phone-hacking scandal.

Shares rose 67 cents, or 4 percent, to $ 16.02 during afternoon trading after the company's Deputy chief operating officer, Chase Carey, is called by the bid. Carey said "it has become apparent that it is too difficult to make progress in this climate."

Claims that News World reporters hacked into mobile phone voice messages by celebrities, politicians and victims caused the Rupert Murdoch-controlled conglomerate-shutter 168 years old tabloid.

But that did not contain the crisis. On Monday referred to the British Government News Corp. bid for British Sky Broadcasting Britain's competition authorities, where it would have been bound for months. Former Prime minister Gordon Brown also accused other News Corp newspapers of criminal hacking. That threatens to envelop the Sun and The Sunday Times. The Sun has denied any wrongdoing.

Nomura analyst Michael Nathanson said in an analyst note as investors shifted their view back to News Corp. strong fundamental underpinnings, residing in its U.S. cable channels such as Fox News, its movie studio 20th Century Fox and United States broadcast network Fox.

Nathanson said he saw upward shares with a target price of $ 21. He said that it was time for the company to pull out of the U.K. newspaper business. All News Corp. newspapers, including the U.K. newspapers and The Wall Street Journal, represented less than 3% of its 1.06 billion dollars in operating profit in the last quarter.

"Perhaps this rebuke will force News Corp. to reconsider its ownership of U.K. newspapers," he said in the note. "We hope this is a turning point for the allocation of the company's strategy and asset ownership of very inconsistent newspaper assets has forced the abolition of a strategically important asset.

In March, had News Corp single 11.8 billion dollars in cash in preparation for the BSkyB deal. Objects the investors ' concern over what it would do with cash if the deal was delayed or called, the company decided Tuesday to increase the amount of shares it buys back from the market to 5 billion dollars over the next 12 months, from a planned 1.8 billion dollars.

Now that the deal is completely, seeking investors for more insight into new ways the company will spend their money.

"We see now, investors ' focus returned to the potential distribution of cash, as we see nearing 15 billion dollars," said Standard and poor's Equity Analyst Tuna Amobi, maintained his "buy" rating on the shares.

As far as BSkyB, in which News Corp still owns 39 percent of the shares, the shares closed 2 percent higher at 705 pence ($ 11.35), after trading around 680 pence after News Corp said it do their bidding.

In the immediate aftermath of the statement shares Tanked at a low of 665 pence, but the knee-jerk sell-off was short-lived.

Speculators hedge funds – which was open to budgetary outcomes from the prospect of a better News Corp offer – is pull out. At the same time, "said analyst new investors looking to buy up what has become relatively inexpensive material for a company that is highly profitable.

Murdoch drops bid for British Sky Broadcasting

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LONDON (AP) — Rupert Murdoch's dream of controlling a British broadcasting behemoth evaporated Wednesday as he withdrew his bid for BSkyB — the latest, biggest casualty of what Prime Minister David Cameron called the hacking "firestorm" sweeping through British politics, media and police.

Cameron appointed a senior judge to lead an inquiry into the phone hacking and police bribery scandal engulfing Murdoch's British newspapers, and promised it would investigate whether Murdoch's reporters sought the phone numbers of 9/11 victims in their quest for sensational scoops.

"There is a firestorm, if you like, that is engulfing parts of the media, parts of the police, and indeed our political system's ability to respond," Cameron said Wednesday in the House of Commons.

"What we must do in the coming days and weeks is think above all of the victims ... to make doubly sure that we get to the bottom of this and that we prosecute those who are responsible," he said.

As lawmakers from all the country's main parties united to demand that Murdoch's News Corp. withdraw its bid for British Sky Broadcasting, the media magnate bowed to the inevitable, accepting that he could not win government approval for the multibillion dollar takeover.

"It has become clear that it is too difficult to progress in this climate," News Corp. deputy chairman and president Chase Carey said in a brief statement to the London Stock Exchange.

Shares in BSkyB fell 4 percent after the announcement, but rebounded as uncertainty about the company's immediate future was lifted and closed 2 percent higher.

Murdoch had hoped to gain control of the 61 percent of BSkyB shares that he doesn't already own. The takeover — potentially his biggest, most lucrative acquisition — appeared certain to succeed just over a week ago, despite concerns about the size of Murdoch's hefty share of the British media market.

But the deal unraveled with stunning speed after a rival newspaper reported that Murdoch's News of the World tabloid had hacked into the phone of teenage murder victim Milly Dowler in 2002 and may have impeded a police investigation into the 13-year-old's disappearance.

What had for several years been a trickle of allegations by people who claimed to have been hacked by the paper — from celebrities like Sienna Miller and Jude Law to politicians including former Deputy Prime Minister John Prescott — became a torrent. Potential victims swelled to include other child murder victims, 2005 London bombing victims and the families of dead British soldiers.

News Corp. responded by killing off the 168-year-old weekly newspaper, which published its final issue on Sunday. Murdoch flew to London in a desperate scramble to keep the BSkyB bid alive.

But still the allegations mounted. Former Prime Minister Gordon Brown claimed his bank details and the medical records of his young son, who has cystic fibrosis, had been obtained by other Murdoch papers.

The Daily Mirror newspaper, a rival to Murdoch's The Sun tabloid, claimed that a reporter for a Murdoch paper may have sought the phone numbers of victims of the Sept. 11 attacks in the United States.

Politicians from all parties, who for more than three decades have sought the approval of the Murdoch press, finally abandoned him.

"The terrible revelations of the last week have shaken us all," Labour Party leader Ed Miliband said in parliament Wednesday. "The events of the last seven days have opened all our eyes and given us the chance to say: It doesn't have to be like this."

Wednesday's debate centered on a motion declaring that Murdoch's bid for BSkyB would not be in the national interest. All three main parties had vowed to back the nonbinding motion.

The debate went ahead after Murdoch withdrew his bid, and the motion was approved without a formal vote, in a chorus of "ayes."

News Corp. lost several billion dollars in market value after the scandal broke last week, but its shares rallied after the company said Tuesday that it was buying back $5 billion of its own shares. Shares rose 71 cents, or 4.6 percent, to $16.06 in afternoon trading in New York.

For Murdoch, it was a dramatic reversal. For three decades, the Murdoch media empire has had near-mythic powers among British politicians to destroy careers and determine the result of elections. After the Conservatives triumphed in the 1992 election, the Sun blared in a front-page headline "It's the Sun wot won it" — and few doubted that it was true.

Steven Barnett, communications professor at the University of Westminster, said Murdoch's retreat signaled a new era in British political life.

"This means the British Parliament has discovered its spine," he said. "After 30 years of successive governments caving in to powerful media corporations, finally Parliament has realized it has to take a stand."

It was a bitter irony for Murdoch that it was the News of the World, his first British acquisition in 1969, that sabotaged his ambitions to control the nation's most profitable broadcaster.

Its ramifications for News Corp. and its executives — particularly Murdoch's son James, head of News Corp.'s European and Asian operations, and the chief of its British division, Rebekah Brooks — are still playing out.

The scandal claimed a senior casualty Wednesday as News International, the company's British unit, said its legal director, Tom Crone, had left the company. Crone led an internal inquiry that concluded only two people at News of the World had been involved in phone hacking — a stance that collapsed as numerous revelations tumbled out this year.

Cameron has struggled to control a spiraling scandal that includes his own former communications chief, Andy Coulson — an ex-News of the World editor — being arrested. The prime minister announced he was putting senior judge Brian Leveson in charge of an inquiry into phone hacking and alleged police bribery by the tabloid.

The inquiry will be able to compel witnesses — including government figures — to give evidence under oath.

Leveson will first investigate the culture, practices and ethics of the press, its relationship with police and the failure of the current system of self-regulation. The judge said the inquiry would begin "as soon as possible," but that its second phase, examining what went wrong at the News of the World, would have to wait until the criminal investigation is complete.

Police are pursuing two investigations of News International, one on phone hacking and the other on allegations that News of the World bribed police officers for information. Police have indicated the bribery investigations involve about half a dozen officers.

Detectives have arrested eight people so far in their hacking investigation, including Coulson. No one has been charged. Cameron said police had the names of more than 3,700 potential victims, and would be contacting them all.

The allegation that Murdoch papers may have targeted 9/11 victims comes from the Mirror, which quoted an anonymous source as saying an unidentified American investigator had rejected approaches from unidentified journalists who showed a particular interest in British victims of the terror attacks. It cited no evidence that any phone had actually been hacked.

In Washington, Sen. Jay Rockefeller, a Democrat from West Virginia, urged an investigation into whether News Corp. had violated U.S. law because of the British paper's activities.

If there was any phone hacking of Americans "the consequences will be severe," said Rockefeller, chairman of the Senate Committee on Commerce, Science and Transportation.

A report Wednesday in The Wall Street Journal, which is part of News Corp., said Murdoch met with advisers in recent weeks to discuss possible options, including the sale of his remaining British newspapers — The Sun, The Times and The Sunday Times. The Journal, citing unidentified people familiar with the situation, said there didn't appear to be any buyers given the poor economics of the newspaper division.

A defiant mood was evident at The Sun, which slapped the headline "Brown Wrong" across its front page in response to the former prime minister's claims the paper had obtained confidential medical records of his 4-year-old son Fraser.

The newspaper insisted it learned of the boy's ailment from the father of another child with the same condition, and that it contacted the Browns, who consented to the story.

On Wednesday, Brown accused Murdoch's media empire of "lawbreaking often on an industrial scale."

Speaking in the House of Commons, he said victims saw "their private, innermost feelings and their private tears bought and sold by News International for commercial gain."

"News International descended from the gutter to the sewer," Brown said.

____

Associated Press writers Bob Barr, Cassandra Vinograd and Gregory Katz in London contributed to this report.

___

Jill Lawless can be reached at http://twitter.com/JillLawless

Ill. gov signs bill increasing coal gas plant

CHICAGO (AP) — wrote the Illinois Gov. Pat Quinn law Wednesday that could lead to the construction of a new facility in Chicago that converts coal to natural gas.

Quinn signed the legislation in a former steel mill site on Chicago's South side where the New York-based Leucadia national Corp. to build 3 billion dollar plant.

"This project protects Illinois consumers, while maintaining our position as a leader in clean energy technology by using home grown resources to create jobs today and tomorrow," Quinn said in a statement.

Quinn blocked earlier versions of the bill to avoid large price increases for consumers. The new legislation restricting natural gas bill is increasing at 2% per year.

Sierra Club were not satisfied with Quinn's decision to sign the law.

"Creating synthetic natural gas is a very dirty way to get our gas," Rebecca Clayborn, a representative of the Sierra Club Midwest clean energy campaign. "It is dirty, it is dangerous and it is not necessary."

Clayborn said the law will be charged to consumers with expensive natural gas for decades to come.

There are other obstacles before the new facility could open. Leucadia has still to be able to add impurities in the overcrowded industrial area in Chicago where we want to build. And the company need a buyer for CO2 emissions.

"We are engaged in close cooperation with local leaders and community members to make this project a tangible benefit to Chicago and the entire state of Illinois," says Tom Mara, vice Chairman of Leucadia in a statement.

Budget deficit on track to top $ 1 trillion

WASHINGTON (AP)--the federal budget deficit is on pace to break the $ 1 trillion Mark for the third straight year, ratcheting up the pressure on the White House and Congress to reach a deal to rein in spending.

The deficit amounted to 971 billion dollars for the first nine months of the year, "said the Finance Ministry Wednesday. Three years ago, who had been a record high for the entire fiscal year.

With three months left, will this year's deficit is likely to top last year's $ 1.29 trillion gap, according to the Congressional Budget Office. But it is expected to come during the record $ 1.49 trillion achieved by 2009. The financial year ending Sept. 30.

For June was deficit of 43 billion dollars, below the 68 billion dollar imbalance in June 2010. Much of the improvement from last year was due to a one-time reduction in the estimated cost of education loans.

But the Government is also opposed to more tax revenues this year, reducing the deficit lite. Revenue rose 9 percent, or 137 billion dollars, by June, the Treasury report said.

It is partly because more Americans have jobs. The economy has added a million jobs over the past nine months, but there are still almost 7 million fewer jobs than before the recession.

Government spending increased this year. Interest on public debt rose 9 percent to 386 billion dollars during the first nine months of this year, compared with the same period last year, one of the biggest increases in spending. Spending on Medicare and Social Security benefits, also increased. (Social Security is the public pension system U.S. and Medicare is the federal insurance program, health care for persons aged 65 and over).

Soaring deficits have kept up a vote to raise the country's $ 14.3 trillion borrowing limit. Republicans and President Barack Obama is to sit out a long-term plan to trim federal spending. Republicans have been demanding steep spending cuts in exchange for voting to increase the limit by borrowing. Obama and Democrats in Congress want tax increases are included in the deal, which the Republicans have to oppose.

The Government reached its limit for borrowing in may Treasury Secretary Timothy Geithner has warned that if the border is not taken up by Aug. 2, is used as the country default on its debt for the first time ever.

But negotiations between the White House and President Obama is still the two sides meet Wednesday for their fourth negotiating session in as many days. Obama has said the daily meetings will continue until an agreement has been reached.

A two-hour session Tuesday produced no progress. Which prompted the top Republican in the Senate proposing gives Obama sweeping new powers to increase the limit to avoid default.

Minority Leader Mitch McConnell offered a plan to allow the President to call for up to $ 2.4 trillion in new borrowing authority until the summer of next year in three separate pleadings. The increases would automatically apply unless both Republican-controlled House and the Democratic-controlled Senate adopted legislation over them.

Obama would veto such legislation gives him power to muscle through debts increased.

Republican plan would require the use of Obama in spending cuts, along with his borrowing requirements. But unlike increased borrowing limit, would not automatically enters into force.

The Government no later than a budget surplus in 2001, when income was 127 billion dollars larger than expenditure. The surpluses were expected to total $ 5.6 trillion over the next decade.

But the country was back in the red by 2002. Deficit deteriorated after President George w. Bush won approval for massive tax cuts and launched the invasion of Iraq and Afghanistan.

In 2008 reached Bush's last full year in office, deficit 454.8 billion dollars, a record at that time. And when the economy plunged into a deep recession, the annual imbalance topped $ 1 trillion.

Higher spending on unemployment insurance and food stamps and a sharp decline in tax revenues, increased the deficit. And it grew even more after Obama administration supported a 787 billion dollar programme to stimulate the economy.

The deficit also deteriorated after Obama and the congressional Republicans have agreed to extend the Bush tax cuts for two years.

Capital a 2Q profit, plans $ 2B stock offers

NEW YORK (AP) — Capital one financial Corp. said Wednesday that its second quarter profit climbed 50 percent, as its credit cards improve payment habits and loan customers get the Bank to drastically reduce it had set aside to cover expenses for uncollected.

The company, best known for his strongly advertised credit card activities, also announced the inventory offers a 2 billion dollar. Funds will be used to pay for the Bank's planned 9 billion dollar acquisition of INGS banking unit, announced last month.

News of the offer pressured stocks in midday trade. A share capital slipped 72 cents to $ 51.52 in heavy trading, as the larger markets increase.

McLean, Virginia-based bank said net profit rose to 911 million dollars or $ 1.97 per share, in the three months ended June 30, compared to 608 million dollars, or $ 1.33 per share, a year ago.

Analysts, on average, revenues are expected at $ 1.73 per share, according to data provided by FactSet.

Net interest income, the money was from deposits and loans, increased to 3.12 billion USD 3.1 billion dollars. That was helped by capital acquisition in April by Kohl's credit card portfolio.

The amount which the Bank wrote as uncollectible decreased in the quarter, the net kostnadsfritt-off reduction of 214 million dollars, 2.91% of balances on annualized basis, from 5.35 percent a year ago.

Improving turned capital a dropping 579 million dollars from the reserves had been set aside for future depreciation. Sterne Agee, said analyst Henry Coffey release adds approximately 81 cents to earnings per share for the period.

Total loans at the end of the quarter increased 4 percent to $ 4.9 billion, driven largely 3,7 billion dollars contributed to Kohl, along with growth in auto finance and commercial banks. Coffey noted that credit card balances have dropped during the quarter.

Non-ränteintäkter or money earned from fees and charges, climbed to 857 million dollars from 807 million dollars.

Capital a, which is known for his advertising campaign "what's in your wallet?" said marketing expenditure increased to 329 million dollars from 219 million dollars during the quarter.

The company said that stocks offer subject to forward sale agreement with Barclays Capital and Morgan Stanley.

Capital one provides the underwriters a 30-day option to purchase up to an additional $ 300 million shares to cover any excess demand.

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AP Business writer Michelle Chapman in New York contributed to this report.

Boehner: nobody wants standard, would be a crapshoot

WASHINGTON (AP) — House Speaker John Boehner says nobody wants to see the nation going into government standard that the White House and lawmakers scrambling to find a deal to avoid this.

Said Boehner: "nobody wants to go there, because nobody knows what will happen. It's a crapshoot. "

Government standard could rock the economy. The nation will go into default by Aug. 2 on debt ceiling is not raised.

In remarks to a small group of reporters said Boehner he has not been able to obtain commitments from the President and the White House on cutting large law programs.

He said that "treat them in the last two months have been dealing with Jell-o."

Miller Coors victims Minnesota shutdown

MINNEAPOLIS (AP) — Miller, Coors and other popular beers may disappear from the Minnesota shops and bars in the days since the brewing giant Miller Coors lack proper licenses due to State Government shutdown.

Miller Coors has 39 "brand tag registrations" with the State which expired last month, and the employees who process renewals were made redundant when the Government shut down July 1, in a budget dispute, Doug Neville, spokesman for the Department of public safety, said Wednesday.

State alcohol officials remain at work recently told officials with the Chicago-based Miller Coors LLC that they need to come up with a plan soon to draw its products, "he said.

"I think we're looking at days instead of weeks before any action needs to be taken, but I don't have an exact date," said Neville.

Miller Coors spokesman Julian Green said brewer still hope to resolve the dispute through discussion with State alcohol regulators, but does not rule out legal action.

"With 39 brands are at stake in one of our largest markets in the country, during one of the highest selling periods in the summer, we are not our business to ensure accurate state licenses," Green said. -Particularly when it affects the livelihoods of our distributors and retailers, and ultimately affect our customers that cannot buy our trademarks.

The trade marks concerned include not only Miller and Coors lines, but a long list of regional and craft beer Leinenkugel and Blue Moon and Pilsner Urquel imports and Molson.

The same problem can affect other brewers, wineries and distillers sometime, "said Neville. And there are hundreds of bars, restaurants and liquor shops over State run probably in a similar renewal requirements that begin leave them unable to replenish their supplies as the hottest part of the year approaches.

Minnesota requires that brewing, wineries and distillers take out brand tag registrations for products they sell in the State. They cost only $ 30 and are good for three years. Miller Coors ' registrations expired on 13 June.

Green said Miller Coors in its paperwork and check on time, on the 13th. Neville said the State did not receive them until June 15, two days after the publication of registrations expired.

If it was the 13th or 15th may not have underscored since the control was for $ 1,688,706, $ 210 overpayment, said Green. Delayed the process. The State received a second check for the correct amount on June 27, he said.

But at that time, Neville said, employees in the Department's alcohol enforcement division does not have the time to process renewals before they were made redundant. In addition to this, he said, the database in which they use to process the renewals were taken offline, along with some other systems as the Department's skeleton IT personnel can concentrate on keeping more critical system relied upon by law enforcement agencies.

Companies with closure disputes can go to the courts of the State, which has established a process for handling of pleas for help that is supervised by the Ramsey County Chief Judge Kathleen in and a designated special master, former State Supreme Court Chief Justice Kathleen Blatz.

That is what many retailers have already done. They are obliged to have 20 dollar "buying" card to buy liquor from wholesalers, and they must be renewed every year by the same laid-off employees who process trade mark registrations. Hundreds of them has expired or will soon. So did retailers before Blatz on Tuesday to ask for an order to recall some employees to process renewals. A decision is pending.

Green said Miller Coors wants to reach a solution through discussions of legal action.

"Now we are still selling beer in the State, but we hope we can bring this matter to a resolution because there are a number of Minnesota businesses are at stake. In this environment, we do not want to see these companies that negatively impacted. "

It is not about discussions could solve the problem, however. Neville said alcohol control officials determined they just were not able to look the other way and let the Miller Coors do business as usual.

"Our enforcement agents looked closely at the Charter and there is nothing there that allows us to make special arrangements with anyone," said Neville.

Neville, did not know which other producers besides Miller Coors, the country's no 2 brewer, is affected, but said the St. Louis, MO.-based Anheuser-Busch Cos. Inc., the largest U.S. beer maker, is certainly at least until 1 October. "Our agents, I know, look at other brands," he said.

The potential loss of popular Miller Coors beer comes as another blow to the liquor store, restaurant and bar owners who thought things couldn't get any worse, "says Frank Ball, Executive Director of the Association Minnesota licensed beverage.

"It could be 102 ° this weekend," said ball. "We need cold beer."

Bernanke: Fed would deliver more stimulus if necessary

WASHINGTON (AP) — saying reserve Federal Chairman Ben Bernanke on Wednesday that the central bank is prepared to give a further boost to the economic lull persists.

That his twice-a-year economic report to Congress, Bernanke three options would consider that the central bank. One possibility, he said, was another of Treasury bond buying. It would make the third such effort since 2009.

Fed Chief insurance helped drive share prices higher, but it also highlighted the fragile state of the economy for more than two years after economists said the recession had ended. Unemployment has risen for three straight months and a debt crisis in Greece and other European countries are likely to weaken the global economy.

Bernanke warned U.S. regulators that their failure to raise its borrowing limit by Aug. 2 may trigger a major financial crisis. He said that the Government defaults on its debt, would throw the "shockwaves through the entire financial system".

Bernanke says more stimulus would only be necessary if economic conditions worsened and deflation was resurrected as a threat. Deflation is a destabilizing period of falling prices.

He also said that the Fed was nimble to react if the opposite happened. He said the Fed was ready to raise interest rates that were at record lows for nearly three years, the central bank fears a greater risk of inflation.

"We have to keep all options on the table," Bernanke told the House Financial Services Committee on the first of two days of Capitol Hill testimony. "If we come to the point where recovery is fragile" and inflation drops to zero, so the central bank would consider further incentive options, "he said.

The Dow Jones industrial average rose more than 93 points during afternoon trade. Broader indexes also rose.

In addition to buy government bonds, "said Bernanke the Fed could help the economy by:

— Cutting the interest paid to banks on the reserves they hold as a way to encourage them to lend more.

— Communicating more clearly seen how long it plans to keep rates at record low levels. It would give investors confidence that Fed efforts to continue to support the economy.

The Fed last month agreed to wind up the timetable of its programme to stimulate the economy through purchases of 600 billion dollars in Treasury bonds. But the central bank also acknowledged that the economy had slowed in the first half of the year. The result is lowered its economic growth forecast for 2011 and said unemployment would be less than 8.6% this year.

Since then, the Government reported a second straight month of gloomy rental in June. Economy to just 18,000 jobs last month, the fewest in nine months. Unemployment increased to 9.2% – the highest rate in years.

Companies withdrew heavily on rental after adding an average of 215,000 jobs per month from February to April. Economy often need to add 125 000 jobs per month just to keep pace with population growth. And at least twice that many jobs needed to reduce unemployment.

The Fed has said that temporary factors, such as high gas prices and supply chain disruptions caused by the crisis, Japan is jointly responsible for sluggish.

Bernanke says Fed believe Congress should facilitate these obstacles during the second half of the year. But if the forecast shows the error, he said that the Fed is prepared to do more.

"The possibility remains that the recent economic weakness may prove to be more persistent than expected and that deflationary risks can be revived, which implies a need for further political support," said Bernanke.

Economists noted that Bernanke was careful to balance the possibility for further Fed stimulus with the possibility that inflation could become a problem.

Paul Ashworth, U.S. Chief Economist at capital economics, said the Fed would likely agree on further steps unless deflation emerges as a threat again. Ashworth said a decision would not come until next year.

"The Fed to wait and see if the reduction in economic growth was due to temporary factors and if inflation falls back," said Ashworth.

The Fed started his final round of bond purchase by deflation worries increased. Bond purchase programme was Fed the second round of "quantitative easing". It is a term that economists used a tool the Fed can be used to bring down long-term interest rates by buying Government bonds.

The topic of new incentive was raised at the June meeting where Fed policymakers agreed to terminate the last programme. Some members said the Fed should be open to further action on growth failed to pick up enough to "meaningful" reducing unemployment, according to the minutes of the meeting of June 21-22.

Others expressed concern about inflation and said that the central bank would need to take measures to begin removing its low-interest rate policy sooner than currently anticipated. "

The Protocol selected, a division of Fed officials are most concerned that the economy is growing too slowly, including Bernanke, and some regional bank presidents who are concerned that the Feds policy could trigger high inflation.

Bernanke spoke to minority concerns in his testimony. He said that the central bank would be prepared to begin to raise interest rates more quickly than currently contemplated, if prices do not decline.

The Fed has kept its main interest rate at record low close to zero since December 2008. Most private economists believe the Fed will not start to raise interest rates until next summer. And some say that the Fed won't increase up to 2013, based on the slumping economy.

Amazon to sell $ 139 Kindle _ with advertising

SEATTLE (AP) — Amazon.com will start selling a cheaper Kindle e-reader, the company said Wednesday, but customers will see advertising in exchange for the lower price.

Kindle 3 G with special offers will be sponsored by at & T Inc. and costs $ 139 — $ 50 less than the company's regular Kindle 3 G.

Users will the same 3 G wireless at at & t's network without annual contracts or monthly fees, but users will also see advertising and sponsored screensavers, Amazon said.

It is not the first time Amazon has released ad supported versions of the Kindle.

In may, said Amazon would sell a-ad supported Kindle 3 G for $ 164, which was $ 25 cheaper than the standard to the Kindle 3 G was at the time. And in April, Amazon began selling a Wi-Fi-equipped Kindle with ads for $ 114 — 25 kronor less than the usual Kindle with Wi-Fi.

Amazon has consistently lowered the Kindle price since it debuted in 2007 for $ 399.

During afternoon trade, increased shares of Amazon.com, Inc. $ 1.83 to $ 213.06. At & t shares fell 3 cents to $ 30.74.

Wall Street rises on Bernanke comments policy

NEW YORK (Reuters)-Wall Street stocks increased from a three-day selloff on Wednesday as comments from Federal Reserve Chairman Ben Bernanke raised hopes of further stimulating the U.S. economy if necessary.

Feds earlier stimulus effort, known as the QE2, had helped the stock market to make progress with 600 billion dollars in bond purchases, which added liquidity in the economy and contributed to low interest rates.

"The possibility remains that the recent economic weakness may prove to be more persistent than expected and that deflationary risks can reemerge, implying a need for further political support," said Bernanke House Financial Services Committee.

<.vix>, CBOE volatility Index, Wall Street fear gauge, fell 7.6% to 18.37 after comments. In the last three days, VIX climbed almost 25% while the S & P 500 lost about 2.3 percent, pressured by weak results and concerns over the EU'sdebt crisis.

"The last round of quantitative easing was strictly for the benefit of inventory, and profits today, the Outlook for what is potentially a further boost, says John Kosar, research team leader at Asbury research in Chicago."But the fact that we also discuss another round, shows how the economy is still struggling. "

His comments came as investors were divided over whether the Fed would introduce another round of incentives to stimulate the economy, especially after the June security dismal jobs report. The Fed's "easy money" policy since 2008 is fueling stock market rally.

<.dji> Dow Jones industrial average was 124.27 points or 1.00 percent, at 12, 571.15. Standard & Poor <.spx> 's 500 Index was up 13.55 points, or 1.03%, at 1, 327.19. The Nasdaq Composite Index <.ixic> was up 33.64 credits, or 1.21 percent, at 2, 815.55.

Energy and materials stocks were the top winners. S & P <.gspe> energy sector index shot up 1.5 percent, while August crude futures gained 1.2%, a drop of the dollar. S & P <.gspm> materials sector index increased 1.6 percent. Baker Hughes Inc was one of the top energy sector winner, will increase 3.7 percent to $ 75.14.

Wall Street got an early boost from overseas data that showed China's economy grew faster than expected during the second quarter.

But it was still cautious over developments in Europe. Moody's downgraded Ireland's debt to junk late on Tuesday and said Ireland was likely to follow Greece in need a second operation. Irish bond yields jumped to record highs.

"Bernanke helps today to layers, but given everything else on the table, I would imagine that the market in a short time will return to focus on issues of European and U.S. budget deal soon," said Dan Ripp, Chairman of Bradley Woods and co. Ltd., New York.

News Corp shares jumped 4.6% to $ 16.06 and was Nasdaq most active stock after announcing it had withdrawn a bid of 12 billion dollars to buy 61 percent of the broadcaster BSkyB it does not already own.

News Corp is in the center of allegations that one of its tabloid newspapers committed criminal acts.

Electronic Arts Inc, computer game publisher, buys PopCap Games in some worth up to $ 1.3 billion that it is trying to ramp up its social and casual games portfolio. Shares of the Electronic Arts throw 0.4% to $ 24(10).

(Reporting by Ryan Vlastelica, editing by Kenneth Barry)

BSkyB says confidence in independent future

LONDON (Reuters)-the pay-TV operator BSkyB said it remained convinced of their own future as an independent company after majority shareholder News Corp dropped its bid for 61% of the companies it does not already own.

"We deliver on our clear and consistent strategy and is building a larger and more profitable business in the long term," said Chief Executive Jeremy Darroch, in a statement. "We are still a lot of confidence in broad growth opportunity for the BSkyB. "

News Corp said Wednesday it had withdrawn its bid, which more than a year ago, due to the furor surrounding the company over a telephone hacking scandal at one of their newspapers.

(Created by Kate Holton)

Midday glance: Silver company

NEW YORK (AP) — shares of some top silver companies up at 13.00:

Hecla Mining increased $. 62 per cent, or 8.0 to $ 8.40.

Pan American Silver rose $ 1.75 or 5.5%, to $ 33.41.

Silver Standard increased $ 1.82, or 6.8 per cent, to $ 28.60.

Silver Wheaton rose $ 1.72 or 4.7 percent, to $ 38.38.

NYSE stock records largest percentage increases

NEW YORK (AP) — a look at the 10 biggest percentage gainers in the New York Stock Exchange at 1 p.m.:

US Gold Corp. increased 9.3 percent to $ 6.60.

Jaguar Mining Inc. increased 8.8% to $ 5.44.

First Majestic Silver Corp. rose 8.2% to $ 22.01.

Hecla Mining Co. increased 8.0 percent to $ 8.40.

Dynegy Inc. increased 8.0 percent to $ 6.88.

Hill international increased 7.5% to $ 6.29.

Silvercorp Metals Inc. increased 7.2% to $ 11.15.

LinkedIn Corp. increased 7.2% to $ 106.70.

Fusion-io Inc. increased 7.1% to $ 32.82.

Eldorado Gold Corp. increased 7.0% to $ 17.80.

China growth tops forecast, increasing inflation fight

BEIJING (Reuters)-China's economy grew faster than expected during the second quarter, easing fears of a hard landing and strengthen Beijing's resolve to combat the continued high inflation.

China's statistics office said on Wednesday that stabilise prices still top priority, even if a "complex and volatile" global economy constituted a threat to growth, complicates the political choices.

Second quarter gross domestic product increased 9.5 percent from the year before, exceeding economists ' forecasts for a 9.4% growth, with the help of solid domestic consumption and investment.

But it was still the slowest pace since the third quarter of 2009, when the world economy out of its worst recession in 80 years.

Some cooling was expected--and Welcome--as China has raised interest rates and fixed on bank lending to try to reduce inflation, which hit a three-year high in June. The stronger-than-expected GDP figures suggests Beijing may have more space to tighten without restriction of growth.

"This is very good numbers," said Liu Li gang, an economist at ANZ in Hong Kong.

"It is perhaps the reason (central bank) raised interest rates last week. They show they are not afraid of a significant slowdown in the economy. "

Investors worried that Beijing's tightening campaign can exact heavy toll on the fastest growing major economy in the world, offered figures some reassurance. Industrial output in June was also stronger than expected, growing in its fastest pace in more than a year.

Asian stocks, metals and Australian dollar all increased.

China's GDP in the April-June rose 2.2 percent from the first quarter on a seasonally adjusted basis, a slight increase in the rate from 2.1 percent in the first quarter.

Chinese officials have met with a hawkish in the past few days, aware of the risk of overheating, inflation could stoke unrest.

Although many economists believe that overall inflation pressures will decrease during the second half of the year, prices have soared on popular staples such as pork and it takes time for them to slow down.

A small majority of analysts expect the central bank to raise interest rates this year again, and most forecasts of further increases in Bank reserve ratios, a Reuters poll last week showed.

Sheng Laiyun, a spokesman for China's Statistics Bureau, said stabilising inflation was the primary goal, and policies would be "targeted, flexible and effective," echoing recent statements by Premier Wen Jiabao.

"It is not easy, and China has done a good job to maintain rapid economic growth in the global situation is complex and volatile," says Sheng.

Europe's sovereign debt troubles and a slowdown in the U.S. economy involves two of China's best export customers are struggling. New export orders slipped in June, a manufacturing survey showed earlier in July, which gave rise to questions about China's growth prospects.

But Wednesday's figures suggested domestic demand remains robust. Final consumption contributed 4.6 percentage points to first-half growth, while exports, China's Statistics Bureau said subtracted.

Analysts say China's economy is on course for growth well above 9 percent this year, a rate that would be the equivalent of adding Switzerland GDP of $ 6 trillion economy.

Still, the demand weakness in China's Western export markets may cause economic growth to slow in the third quarter from the second, they say.

REDISTRIBUTION

Industrial production increased 15.1 percent in June from a year earlier, the strongest growth since May 2010. Also noticed a sharp quickening from maize 13.3 percent, beating market expectations of 13.1%.

Growth figures underlined the world's second largest economy, thanks to the country's rapid urbanization, resistance and were able to calm investor fears of a sharp slowdown, which would solve the demand for global commodities.

"Data should also help to dispel the fears about a Wilder economic collapse in China," said George Worthington, an economist with IFR, count unit Thomson Reuters.

Fixed assets investment rose 25.6% in the first six months from a year earlier, while retail trade expanded 16.8%, shows that domestic demand still can be kept relatively well in spite of austerity.

"Economic growth data is rather optimistic and industrial production is significantly stronger than expected," said Xu Biao, an economist with the China Merchants Bank Shenzhen. "It is totally beyond expectations that imports from the PRC and (buy the boss's survey) in June was fairly weak. "

Stronger demand at home helps not only to protect China from the global turmoil, it gives a bit of a cushion for the rest of the world, and proof that Beijing is making good promises to move away from the export-driven growth. But it can also increase price pressure.

Fight against inflation remains priority Beijing but some policy measures should not cause large fluctuations in economic growth, says Premier Wen in comments published on Tuesday.

He announced in June that the country would struggle to meet its average inflation target of 4% in 2011. Monthly consumer price inflation figures show an average of 5.4% in the first half of the year.

Academic adviser to the People's Bank of China was quoted by State television on Wednesday said the inflation rate may have peaked in June, when it hit 6.4 percent.

Li Daokui, a member of the central bank's monetary policy Committee, said the full-year inflation rate could be around 4.8%.

Last Wednesday, up China courses by 25 basis points--the third such increase this year--which took the one-year bank deposit rate to 3.5%.

The Central Bank has increased the benchmark interest rates five times since October and lifted banks claims reserve ratio--its best political tool so far--nine times.

(Additional reporting by Langi Chiang, Gui Qing Koh and Zhou Xin: writing Emily Kaiser: editing of Neil Fullick)

Bernanke: Fed would deliver more stimulus if necessary

WASHINGTON (AP) — saying reserve Federal Chairman Ben Bernanke on Wednesday that the central bank is prepared to give a further boost if the current economic lull persists.

That his twice-a-year economic report to Congress, Bernanke three options would consider that the central bank. One possibility, he said, was another of Treasury bond buying. It would make the third such effort since 2009.

Bernanke indicated that the Fed would only take such action if economic conditions worsened and deflation was resurrected as a threat. Deflation is a destabilizing period of falling prices.

He also said that the Fed was nimble to react if the opposite happened. He said the Fed was ready to raise interest rates that were at record lows for nearly three years, the central bank fears a greater risk of inflation.

"We have to keep all options on the table," Bernanke told the House Financial Services Committee on the first of two days of Capitol Hill testimony. "If we come to the point where recovery is fragile" and inflation drops to zero, so the central bank would consider further incentive options, "he said.

Stocks jumped after Bernanke signaled that the Fed will to take additional measures to boost the sluggish economy. The Dow Jones industrial average rose more than 145 points, or 1.2%, at noon trade. Broader indexes also rose.

In reply to a question about Congress debate on raising the limit borrowing, Bernanke warned that failure to adopt within the time limit that August would trigger a wider financial crisis. He said that the Government defaults on its debt, would throw the "shockwaves through the entire financial system".

The Government reached its limit for borrowing in may, the Finance Ministry has said that Government displays by default on its debt limit not raised by Aug. 2.

The Fed last month agreed to wind up the timetable of its programme to stimulate the economy through purchases of 600 billion dollars in Treasury bonds. But the central bank admitted that the economy had slowed in the first half of the year. The result is lowered its economic growth forecast for 2011 and said unemployment would be less than 8.6% this year.

Since that meeting, the Government reported a second straight month in June and gloomy letting unemployment increased to 9.2% – the highest rate in years.

The Fed has said that temporary factors, such as high gas prices and supply chain disruptions caused by the crisis, Japan is jointly responsible for sluggish.

Bernanke says Fed believe Congress should facilitate these obstacles during the second half of the year. But if the forecast shows the error, he said that the Fed is prepared to do more.

"The possibility remains that the recent economic weakness may prove to be more persistent than expected and that deflationary risks can be revived, which implies a need for further political support," said Bernanke.

Economists noted that Bernanke was careful to balance the possibility for further Fed stimulus with the possibility that inflation could become a problem.

Paul Ashworth, U.S. Chief Economist at capital economics, said the Fed would likely agree on further steps unless deflation emerges as a threat again. Ashworth said a decision would not come until next year.

"The Fed to wait and see if the reduction in economic growth was due to temporary factors and if inflation falls back," said Ashworth.

The Fed started his final round of bond purchase by deflation worries increased. Bond-buying program, which ended in June, it was Fed the second round of "quantitative easing". It is a term that economists used a tool the Fed can be used to bring down long-term interest rates by buying Government bonds.

The topic of new incentive was raised at the June meeting where Fed policymakers agreed to terminate the last programme. Some members said the Fed should be open to further action on growth failed to pick up enough to "meaningful" reducing unemployment, according to the minutes of the meeting of June 21-22.

Others expressed concern about inflation and said that the central bank would need to take measures to begin removing its low-interest rate policy sooner than currently anticipated. "

The Protocol selected, a division of Fed officials are most concerned that the economy is growing too slowly, including Bernanke, and some regional bank presidents who are concerned that the Feds policy could trigger high inflation.

Bernanke spoke to minority concerns in his testimony. He said that the central bank would be prepared to begin to raise interest rates more quickly than currently contemplated, if prices do not decline.

The Fed has kept its main interest rate at record low close to zero since December 2008. Most private economists believe the Fed will not start to raise interest rates until next summer. And some say that the Fed won't increase up to 2013, based on the slumping economy.

Bernanke confirmation when the Government released a dismal jobs report last week.

Economy to just 18,000 jobs last month, the fewest in nine months. The may figures were revised downwards and to show only 25,000 jobs added — fewer than half of what was reported from the beginning.

Companies withdrew heavily on rental after adding an average of 215,000 jobs per month from February to April. Economy often need to add 125 000 jobs per month just to keep pace with population growth. And at least twice that many jobs needed to reduce unemployment.

AP exclusive: Nike face new worker abuse claims

SUKABUMI, Indonesia (AP) — Saying workers making sneakers Pinault in Indonesia supervisors throwing shoes at them, slap them in the face and call them pigs and dogs. Nike, the trade mark owner, admits that such abuse has taken place among the entrepreneurs that make its hip high-tops but says there was little it could do to stop it.

Dozens of workers interviewed by The Associated Press and a document released Nike shows that footwear and athletic apparel giant has far to go in order to meet the standards that it set for itself a decade ago to end reliance on sweatshop labour.

That does not seem to explain addiction workers claims on Pou Chen Group factory in Sukabumi, some 100 km (60 miles) from Jakarta – it does not start making Pinault products until four years after Nike bought Converse. A worker there said she was kicked by supervisor last year after having made a mistake when cutting rubber soles.

"We are powerless," said the woman, who like several others interviewed spoke on condition of anonymity for fear of reprisals. "Our only option is to live and suffer, or speak and be fired."

The 10,000 most female employees at the Taiwanese-operated Pou Chen plant makes about 50 cents an hour. It suffices, for food and bunkhouse-style is set, but little else. Some workers interviewed by the AP in March and April are described as affected or scratched in the arm — a man until he bled. Others said they were fired after the submission of complaints.

"They are throwing shoes and other things on us," said a 23-year-old woman in embroidery division. "They growl and slap us when they become angry.

"It is part of our daily bread."

Mira Agustina, 30, said she was fired in 2009 to sickness absence, although she produced a doctor's note.

"It was a horrible job," said she. "Our executives pointed to the feet of us, call us names such as dog, pig, or monkey." All are great insults against Muslims. Indonesia is the world's most populous Muslim nation.

At PT Amara footwear factory, located just outside Jakarta, where another Taiwanese entrepreneur makes Pinault shoes, supervisor ordered six female workers to cope with the blazing sun after they failed to achieve its objectives to complete 60 dozen pairs of shoes in time.

"They were crying and continue its work until after two hours under the Sun, said Ujang Suhendi, 47, a worker in a warehouse in the factory. The women supervisors received a warning letter for may event after complaints from unionized workers.

The company's own investigations also found workers at two factories were "serious and egregious" physical and verbal abuse, including the punishment of forcing workers to stand in the Sun, "says Hannah Jones, a Nike executive who oversees the company's efforts to improve working conditions.

"We see other issues of a similar nature as will the entire supply chain, but not on a frequent basis," she said, "We see questions of working conditions on a less egregious nature across the Board."

Nike, which came under heavy criticism a decade ago for its use of Foreign Sweatshops and child labor, has taken steps since then to improve conditions at its 1,000 overseas factories. But the progress at factories producing gear with his premier "swoosh" logo is not fully for those who earn Pinault products.

An internal report Nike released to the AP after asked about drug use shows that almost two thirds of 168 factories making Pinault products throughout the world do not meet its own standards for Nike contract manufacturers.

Twelve is the most serious in the category of problems which can consist of anything from illegal long working hours as to deny access to Nike inspectors. A Nike spokeswoman said the company was unaware of the physical abuse at these factories. Another 97 belongs to a category which is defined as making any progress in improving the problem extends from isolated verbal harassment to pay less than the minimum wage. A further six factories had not been revised by Nike.

NIKE blames problems on existing licences to produce Pinault goods it says prevent parent company from inspecting factories or impose their own code of conduct.

It says that the situation is further complicated because the licence holders usually farm out the production work to a subcontractor. Most of the agreements reached for the renewal during the last five years. But it is only the last two years that it has made a concerted effort to include Pinault factories in the monitoring programmes for Nike factories.

"We have been working every time we can for the renewal of such contracts or to modify these agreements or to terminate these agreements and to ensure that we have more ability to influence the licensee and their subcontractors much more directly when we make new agreements," said Jones.

Some business experts question whether the company is doing all it can.

"I simply impossible for a company of Nike size and market power is impotent in persuading a local factory in Indonesia or anywhere else in the meet its code of conduct," said Prakash Sethi, corporate strategy professor at Baruch College, City University of New York.

Critics of outsourcing production to the cheapest countries says it keeps prices but make clothes, electronics and toy companies can reduce their accountability for the conditions in these factories. Although concern about sweatshop labor force has increased, some contractors simply moved the business to more remote areas, away from the international and local watchdogs unauthorized eyes.

Indonesia is Nike's third largest manufacturing industry, after China and Viet Nam, with 140,000 employees in 14 contract factories. Of these produce 17,000 its Pinault line at four factories.

Pou Chen, the largest of the four Pinault factories located in a hilly city where the minimum wage is significantly lower than the national average. Sukabumi can only be accessed by car – a five-hour journey over rough, winding roads. The plant began making Pinault products in 2007.

Taiwanese Contractor said it fires a supervisor after being told the workers had spoken with The AP earlier this year.

Other involved ill-treatment, but has been able to keep their jobs, according to the Pou Chen.

NIKE says the factory develops programs to teach managers, cultural sensitivity and leadership skills.

It says it also is closely monitoring PT Amara factory.

After years of criticism over its labor practices at factories abroad became Nike in 2005, the first major apparel company to disclose the names and locations of hundreds of plants producing their sneakers, clothes and other products.

It acknowledged that the find "offensive treatment" — either physically or verbally — in many of the plants as Nike. The complaints ranged from workweeks that exceeded 60 hours to be prohibited to go to the toilet.

Beaverton, Oregon, Oregon-based company has since made significant investments in training managers and more closely monitor their activities.

Nike has not published the locations of all factories that make products for affiliate companies, including Converse, but plans to at the end of the year.

___

Wright reported from Jakarta, Indonesia. http://www.Twitter.com/stephenwrightAP

Midday glance: education enterprises

NEW YORK (AP) — shares in some companies as the highest education is up at 13.00:

Apollo Group increased $. 14, or 3 percent, to $ 49.85.

Career education increased $. 77 or 3.4 per cent, to $ 23.43.

DeVry rose $ 1.01, or 1.6%, to $ 62.58.

Strayer education increased $ 2.30, or 1.7 percent, to $ 139.33.

Midday glance: Pharmacy enterprises

NEW YORK (AP) — shares in some companies as top pharmacy is up at 13.00:

CVSCaremark increased $ 05, or 1 percent, to $ 37.42.

Rite Aid increased $. 01, or 1.2% to $ 1.29.

Walgreen rose $ 48 or 1.1 percent to $ 43.03.

Dodd-Frank roll-back a risk to the economy: Treasury

WASHINGTON (Reuters)-the law review of the financial system should continue to protect the economy in the future, despite all the challenges it is in its first year of existence, a top Treasury official said on Wednesday.

"Scaling back or cancellation of much of the Dodd-Frank Act or do not provide supervisory authorities with the resources they need to implement the law will make our economy is exposed to a bicycle collapses and crises," said Deputy Finance minister for financial markets Mary Miller in prepared remarks for delivery to a securities within the World Trade Organisation.

Miller speaks to mark the one year-årsjubileum passage of Wall Street reform bill, known as Dodd-Frank Act.

"We are working for the implementation of effective reforms that promote stability, which are necessary to restore investor confidence in our markets," according to remarks Miller will do for the securities industry and financial markets Association's regulatory reform Summit.

Debate continues on Capitol Hill over the Dodd-Frank final shape as regulators continue to implement hundreds of new rules required by the law and to monitor the financial system.

The law, President Barack Obama signed on 21 July 2010 has been criticized heavily by the Republicans who have pushed for repeal provisions of the u.s. House of representatives.

(Reporting by Margaret Chadbourn; Editing James Dalgleish)

States ' sales tax growth slows in June: report

WASHINGTON (Reuters)-the central sales tax revenues grew slowly in June, with an average increase of only 2.1 per cent, according to a report released on Wednesday, suggesting a weakening trend that could threaten States ' recoveries.

Only 58 per cent of States met or exceeded their projected sales tax collections in June, compared with 82 percent in may, according to the economic newsletter The Liscio report, which surveys States about their tax levels.

2.1% average of annual growth in June was down from growth of 4.9 percent in may, the Liscio report showed.

"Even if you are an average of two months, it is without doubt the State sales tax receipts are in a declining trend, outside the States with heavy extraction of energy sectors, which is currently high single-digit growth rates," said the newsletter.

Revenue forecasts are crucial for the States ' fiscal planning because all States except Vermont must balance their budgets. During the worst recession of 2007-2009 revenue came in already depressed forecasts, forcing States to provide for emergency spending cuts in nearly all areas of public life.

Noting crawl back from collapse in revenue and budget crises gives income tax revenues the biggest blessing. Last week reported Liscio 77 per cent of the States hit mark on collections from income tax Withholding in June.

For the fiscal year that ended almost all States last month, tax collections beat expectations for at least 28 States, almost everything due to efficiency gains in revenue from taxes on investment and the company's income, according to the Center on Budget and policy priorities, a think tank tracking States taxation conditions.

CBPP said that in those States personal income tax revenues increased 9 percent during the year, more than double the growth as they had forecast. Meanwhile, sales tax is increased 4.4%, 1.5 percentage points above the forecasts.

Moms who made less than a quarter of the State and local government revenues during the first quarter of the year, according to the u.s. Census Bureau, rises to 73.7 billion dollars from 69.7 billion dollars in the first quarter of 2010.

But remain below levels in the first quarter of 2007, before the housing bubble burst and the country fell into recession, according to the Census Bureau.

Report Liscio said that factors such as time succour may collections and the "quite alarming decline between May and June may be long." There are other "noisy" elements to income data, say it.

-But in the noise, weakening trend is clear, it added.

(Reporting by Lisa Lambert, Editing by Leslie Adler)

Midday glance: PBM enterprises

NEW YORK (AP) — shares of some top pbm companies is up at 13.00:

CVSCaremark increased $ 05, or 1 percent, to $ 37.42.

Explicit script step $. 03 or percent, to $ 53.42.

MedcoHealth increased $. 39 or 7 percent, to $ 54.99.

Murdoch drops bid for British Sky Broadcasting

LONDON (AP) — in a stunning retreat decreased Rupert Murdoch's News Corp's bid Wednesday to take full control of the British Sky Broadcasting over what the Prime Minister called a political and media "firestorm" over phone hacking at a the media baron's U.K. newspapers.

Murdoch stepped back from potentially makes his biggest, most lucrative acquisitions, to accept that he cannot win the British Government's approval of the takeover because the country's main political parties had united against it.

"It has become apparent that it is too difficult to make progress in this climate," said News Corp Vice-President and Chairman Chase Carey in a brief statement to the London Stock Exchange.

Shares in BSkyB showed 4 percent lower after the announcement, but released as uncertainty about the company's immediate future was lifted, closing 2 percent higher.

Hours earlier, Prime minister David Cameron announced he was putting a higher judge in charge of an inquiry phone hacking and alleged police bribery by one of Murdoch's British tabloids, the News of the World. The British leader also promised to investigate an allegation that reporter U.K. can have searched phone number of the 9/11 terror victims in a quest for sensational scoops.

"It is a firestorm, if you like, the uppslukar parts of the media, part of the police, and even our political system's ability to respond," said Cameron in the House of Commons. He said must now focus on the victims — police say they will contact over 3 700 people in probe – and ensure that those responsible are prosecuted.

It is a bitter irony of Murdoch that News of the World, his first British acquisitions 1969, sabotaged his ambitions to control the country's most profitable broadcaster.

The Media baron had to close down the 168-year-old muckraking tabloid Sunday and flew to London in a desperate scramble to keep the BSkyB bid alive. Murdoch had hoped to gain control of the 61% of BSkyB shares his News Corp does not already own.

"Thought it was incomprehensible that Mr. Murdoch could continue its takeover after these revelations," said Labour leader Ed Miliband.

Anger has grown and Murdoch's News Corp. 's share price has fallen since a report last week that News of the World had hacked into the phone murders victim Milly Dowler teenage 2002 and may have hindered the police investigation into her disappearance. Followed by data on intrusions into private records of Murdoch's other U.K. papers, the Sun and The Sunday Times.

Police have arrested eight people so far in their investigation, including Cameron's former Communications Director Andy Coulson, former editor of the News of the World. No one has been charged.

Lawmakers held an hour long debate on the scandal Wednesday who had been on the end of a vote on a motion to declare that Murdoch's bid for full control of BSkyB would not be in the national interest. All three main parties had pledged to back the parking card proposal.

The debate went ahead after Murdoch withdrew its bid, but it was unclear whether lawmakers would still vote.

Miliband told legislators that the scrapping of the BSkyB bid was "a victory for the people – United Kingdom upset of betrayal of trust of parts of our newspaper industry good, decent people."

"Make mistakes – the decisions taken by News Corp. was not the decision that they wanted to do," he said.

The scandal cost another media executives their jobs Wednesday. News International, the British unit of News Corp., said the legal Director, Tom Crone, left the company. Crone had led an internal investigation that concluded only two people at the News of the World had been involved in phone hacking of celebrities, politicians, top athletes and murder victims – a stance that collapsed as many revelations came out this year.

Dowlers family met Cameron at 10 Downing Street on Wednesday. Mark Lewis, a lawyer for the family, said they were happy that politicians responded "so quickly in response to public outrage."

Cameron was appointed Lord Justice Brian Leveson to lead the inquiry, which will be able to force witnesses – including Government numbers — to testify under oath.

Leveson will first examine the culture, practices and ethics in the press, its relationship to the police and the failure of the current system of self-regulation. This inquiry is expected to last up to one year. Only then will the investigation focus changed to what went wrong at the news of the world, and other documents, Cameron said.

The judge said some aspects of his work would have to wait until criminal investigation is complete.

"The press gives a fundamental control of all aspects of public life. That is why each error in the media affects us all, "said Leveson. "The focus of this study, therefore may be a simple question: who guards the guardians?"

The proposal that the 9/11 victims may have been directed appeared Monday in the mirror, a British competitor to Sun. It quoted an anonymous source as saying an unidentified American investigators had rejected approaches from unidentified journalists showed a particular interest in British victims of terror attacks. There is no evidence that any phone actually had been hacked.

Washington urged older Jay Rockefeller, a Democrat from West Virginia, an investigation into whether Murdoch's News Corp. had violated u.s. law due to the British paper activities.

If there was no hacking of telephones belonging to 9/11 victims or other Americans, "the consequences are serious," said Rockefeller, Chairman of the Senate Committee on Commerce, science and transportation.

A report Wednesday in The Wall Street Journal, which is part of News Corp., said Murdoch has met with advisers over the last few weeks to discuss the possible options, including the sale of its remaining British newspapers--the Sun, The Times and The Sunday Times. The journal can evaluate unidentified people familiar with the situation, said there appears to be no buyers in view of the newspaper division bad economics.

A defiant mood was still clear at a News International paper, the Sun tabloid, who slapped the heading "Brown errors" on its front page Wednesday in response to claims by former Prime minister Gordon Brown that the paper had received confidential medical records of his younger son.

Brown accused Murdoch's papers, including the Sun and The Sunday Times, in order to have their confidential bank accounts, tax records and health information on his son, Fraser, suffering from cystic fibrosis, using fraudulent means criminal. But the newspaper insisted it learned of the boy's pain from the father of another child with the same conditions, and that it contacted the Browns, who have agreed to that history.

"We are not aware of Mr. Brown, or any of his colleagues as we talked, making any complaints about it on time," Sun said.

Police in the United Kingdom is conducting two studies of News International, a phone hacking and the other on allegations that News of the World bribed police information.

Hugh Orde, President of the Association of Chief Police officers, called News International will clean of any payments.

"If they have names, dates, times, locations, payments to officers, we would like to see them so that we can lock these officers and throw away the key," Orde told the British Broadcasting radio.

Police officials have specified bribery investigations involving about half a dozen officers.

London Mayor Boris Johnson said Wednesday that he had been told that his phone had been chopped but he decided not to take legal action.

"Why on earth should I go through some legal cases where it would have inevitably involved go through all the pathetic so-called revelations as News of the World had dug up?" Johnson said.

Midday glance: commercial banks company

NEW YORK (AP) — shares in some companies as top commercial banks are up at 13.00:

First Horizon increased $. 29 or 3.0%, to $ 9.81.

Zions Bancorp rose $ 52 or 2.2% to $ 24.29.

Midday glance: Coal Company

NEW YORK (AP) — shares in some companies as top coal is up at 13.00:

Arch Coal increased $. 82, or 3.2%, to $ 26.21.

Consol energy increased $ 1.25 or 2.6%, to $ 49.32.

Peabody energy rose $ 1.54 or 2.7%, to $ 59.48.

Wall Street election meetings, snaps 3-day slide at Bernankes view

NEW YORK (Reuters)-Wall Street has grown from a three-day sell-off on Wednesday as comments from Federal Reserve Chairman Ben Benanke raised hopes that there could be a further boost to the economy in the U.S. If needed.

All three major U.S. stock indexes rose more than 1 percent shortly after Bernankes comments while <.vix>CBOE volatility Index, Wall Street fear gauge, fell 7.6% to 18.37. In the last three days, S & P 500 had lost about 2.3 percent on concern Europe's debt crisis.

"He was quite specific, more than he ever had been, and that excited the market. He did not say that they would exert impetus, but it is clear that they discussed the issue, and that there are options to, if necessary, "said Tim Ghriskey, chief investment officer at Solaris Asset Management in Bedford Hills, New York.

Bernanke says the House Financial Services Committee:

"The possibility remains that the recent economic weakness may prove to be more persistent than expected and that deflationary risks can reemerge, implying a need for further political support.

His comments, made on the first day of his semi-annual testimony to Congress on United States and monetary policy, came as investors were divided over whether the Fed would introduce another round of incentives to stimulate the economy, especially after the June security dismal jobs report. The Fed's "easy money" policy since 2008 is fueling stock market rally.

<.dji> Dow Jones industrial average was 146.03 points or 1.17 percent at 12, 592.91. Standard & Poor <.spx> 's 500 Index was up 16.06 points, or 22 percent, at 1, 329.70. The Nasdaq Composite Index <.ixic> was up 39.01 points, or 1 percent, at 2, 820.92.

Energy and materials stocks were the top winners. S & P energy sector index <.gspe> shot up 1.8 percent and the S & P sector materials index <.gspm> increased 1.7%.

Wall Street got an early boost from overseas data that showed China's economy, as measured by its gross domestic product, grew faster than expected during the second quarter.

But it was still cautious over developments in Europe. Moody's downgraded Ireland's debt to junk late on Tuesday and said Ireland was likely to follow Greece in need a second operation. Irish bond yields jumped to record highs.

News Corp shares jumped 6.5% to $ 16.34 after the company announced that it has withdrawn a bid of 12 billion dollars to buy 61 percent of broadcaster BSkyB already owns. News Corp is in the center of allegations that one of its tabloid newspaperscommitted criminal acts.

Electronic Arts Inc, computer game publisher, buys PopCap Games in some worth up to $ 1.3 billion that it is trying to ramp up its social and casual games-portfolio and better compete with Zynga Inc., known for Farmville, a game that is popular with Facebook fans. Shares of the Electronic Arts shed 0.3% to $ 24(10).

(Reporting by Angela Moon, editing by Jan Paschal)

Germany digs in heels over Friday Summit on Greece

Brussels/BERLIN (Reuters)-the Euro zone plans for the Summit in a leader on a second Greek rescue was thrown into doubt as Germany on Wednesday, raising fears the markets can make use of the political vacuum with a new attack on the block high debtors.

Berlin held fast to its policy that Greece was funded until September so there was no rush to finalise the details of a second package. "There are no concrete plans for a special summit," said a German Government spokeswoman.

Others were less sanguine. Italian central bank chief Mario Draghi, soon to take the lead of the European central bank, and Ireland's premier both said a final plan was needed and quickly--echoing a strongly worded attack from Greek Prime minister earlier this week.

Ratings agency Moody's downgraded Ireland's credit to junk status on Tuesday, and said that Greece, would need a second operation. Minds have focused even more sharply by a market attack against Italy which, if required, would strain the eurozone's existing rescue funds.

"Moody's problem lies not in Ireland, Ireland's problem is with Europe," Prime Minister Enda Kenny told Parliament. "There is no point in a meeting which will not provide a conclusion of a comprehensive meaning to something that will not disappear unless it is dealt with."

The European Commission, sharply critical of the role of credit rating agencies play, described Moody's decision as "incomprehensible." That the costs of insurance Irish debt against standard steps and 10-year bond yields hit 14.19%.

Italian and Spanish bond settled but traders expected no long-term respite without decisive action.

"We are still quite bearish on the periphery, in General, given there are different risk factors for policymakers response to the crisis so far," said Michael Leister, a strategist at WestLB. "We are sure not even if they can turn things in the short term."

QUARREL

Leaders must draw down how private holders of Greek Government bonds can be persuaded to defray part of the cost of a new package for Greece and weigh up the potential impact on markets about to secure their participation be declared a debt default by rating agencies, as expected.

But they appeared to be subsiding in a wave of internal quarrels and the risk that creates a hopeless situation:

If someone now Summit on Friday, may have a strong negative impact on the financial markets. If the room and no clear decision, the effects can be worse.

Herman Van Rompuy, President of the European Council, has announced he intends to keep the Summit ambassadors on Friday evening, and most of the Member, 17 euro zone set back the decision, but Germany is reluctant to set a date, especially if there are any ready to take the decision.

"The markets reacted very badly after euro zone finance ministers were unable to reach an agreement," an EU diplomat said, referring to a Finance Ministers meeting on Monday. "If they cannot agree, we take the fight to the highest level. People are working on a number of conclusions to be agreed. "

A senior EU official said the Germans were furious that "backed into a corner" and therefore held fast to not participate on Friday, which was to skittle the Summit. Diplomats said furious rounds of phone calls were made.

They said current intention was for the leaders to meet on Friday night and for Finance Ministers to gather again on Sunday, so the precise details of a plan can be established before financial markets open on Monday.

STRESS TEST

A major problem on the leaders ' minds are the results of stress tests on 91 European banks, to be released on July 15, which is expected to show 10 or more banks may have failed.

That may have an additional impact on Italy, where the bank stocks and the bond market has been affected by growing concerns that the euro zone's third-largest economy may be next in line after Greece, Ireland and Portugal to suffer debt contagion.

Draghi said Italian banks would comfortably withstand stress tests but reiterated Kenny's call for a comprehensive EU response to spreading debt crisis.

"We must realise that the management of the financial crisis has not gone smoothly with partial and temporary interventions," he said in a speech to the Association of Italian banking sector.

"We must now bring security to the process by which sovereign debt crises are handled, by clearly defining policy objectives and for the design of instruments and the amount of resources," he said.

Current proposal on the table to protect private sector involvement in Greece focused on the repurchase of Greek Government bonds and replacement of existing Greek debt for longer dated securities with a lower coupon, thus considerably reducing The outstanding obligations.

However, it is unclear how a buy Greek bonds would be financed. A proposal is to use the 440 billion European financial stability Facility (EFSF), which has been used to bail out Ireland and Portugal.

The ECB is still strongly opposed to any Greek plan to credit rating agencies would likely see by default.

ECB policymaker Jens Weidmann, a former advisor to German Chancellor Angela Merkel, said EFSF should not be used to purchase bonds on the secondary market and it would be unacceptable for the ECB to accept defaulted Greek debt as collateral.

"Money (EFSF) bailout should not be used for purchases of government bonds on the secondary market," he told Die Zeit newspaper. "Containment of the crisis should not mean that we are undermining our principles. We must draw a red line. "

But Germany's Finance Ministry said funds from eurozone rescue mechanism would theoretically already be used by members of the block to buy back own bonds, suggesting a shift in Berlin's stance.

German newspapers ran headlines and articles on Wednesday called on leaders to take their forces.

"The fact that some important State still has not realised the problem the whole amplitude are ... disastrous," the commentator wrote in Die Welt.

A euro group official said Friday's meeting, if it happens, not to deliver on what the market expects.

"If there is a meeting on Friday, it is more psychological than anything else. The heads of State do not take anything, "he said, explaining that it was not enough time between now and then to prepare a meaningful decision.

(Additional reporting by Julien Toyer and Luke Baker in Brussels, and by Noah Barkin and Gernot Heller in Berlin; editing/writing of Mike Peacock)

Midday glance: telecommunications company

NEW YORK (AP) — Shares of some top telecom companies are up at 13.00:

At & t Inc. rose $ 19, or 6 percent, to $ 30.96.

Sprint Nextel rose $. 06, or 1.1 percentage points to $ 5.49.

Verizon rose $. 07% or 2%, to $ 37.16.

Debt talks grind on the clock ticks towards standard

WASHINGTON (AP) — is the budgetary negotiations between President Barack Obama and his GOP rivals frustrating still, leading a top Republican to launch a long-shot the proposal to give Obama sweeping new powers to muscle through an increase in the Government's debt limit without the approval of a bitterly divided Congress.

Lawmakers return to the White House Wednesday for its four negotiating session with the President in as many days. Obama has said the daily meetings will continue until an agreement has been reached.

A two-hour session Tuesday produced no progress after a day of poisonous exchanges between Democrats and Republicans.

Senate GOP Leader Mitch McConnell of Kentucky offered a backup plan, which in practice would guarantee Obama call for new Government borrowing authority concerning Congress Musters vetorätt-proof majorities to deny him. McConnell said he was forced to introduce the plan because he could not see a path to an agreement as long as the Democrats insist on revenue increases.

McConnell said Wednesday that his proposal was a "last resort". If the President continues to shirk its responsibilities to do something about our dire fiscal situation

"Make the President show black and white the specific cuts he claims to support. If he refuses, he will need to raise the debt ceiling, "McConnell said on the Senate floor. -But he is not going to get Republicans to go along with.

Mcconnells proposal immediately ran tough opposition among tea party conservatives and seemed unlikely to pass the House, but neither the White House or the House speaker, John Boehner, R-Ohio, rejected it without.

-I think everyone agrees there has to be a backup plan if we are unable to reach agreement, "Boehner said in an interview from Fox News Channel on Tuesday afternoon. "And I think frankly, Mitch has done a good job."

According to the Mcconnells proposal, Obama can request – and likely secure – increases of up to $ 2.5 trillion in government borrowing authority in three separate installments over the next year as long as he proposed spending cuts in a larger size.

Debt limit increase would take effect if blocked by Congress, according to specific rules requiring swift action — and even then Obama could exercise its power to veto such legislation. But the President's expenditure would have no guarantee of receiving a vote.

"The American people have chosen (McConnell) to act as a check on Obama's appetite for out-of-control spending, not to write him a blank check to continue binge," said conservative activist Brett Bozell. "These are the kind of shenanigans that made Republicans rolled out in 2006."

Tea party favorite older Jim DeMint, R-s.C., asked about Mcconnell's plan Wednesday on CBS ' "The Early Show," said, "Republicans weren ' t selected in November to make it easier to spend and borrow and add our debt."

GOP presidential candidate Newt Gingrich wrote on Twitter, "Mcconnell's plan is an irresponsible surrender to large government deficits and continued budget surpluses."

Republicans, meanwhile, continued to push for a balanced budget amendment that would require Washington to balance their books. McConnell said the politicians in Washington have showed they are not able to get the job done, and "If the President fails to do something about the debt you'll go around him and take it to the American people."

McConnell published his proposals for a few hours before Obama led his third meeting in as many days with Congressional leaders are looking for a way to avoid a default and any financial crisis Tuesday.

Democratic officials who participated in the session said Obama does not reject the Mcconnells idea, but said that it is not his best practices. A statement later as press officer Jay Carney said the President "continues to believe that our focus must remain on take this unique opportunity to agree on a substantial and balanced the deficit."

Mcconnell's plan was hatched from frustration that Congress and Obama is blocked as clock ticks towards an Aug. 2 deadline for market-rattling default on U.S. obligations. McConnell said he still hoped an agreement could be reached, but that a backup plan would see the markets and the public that the standard is not an option.

The Republicans are demanding $ 2 $ 1 trillion plus in budget cuts the price of a similar increase in the Government's ability to continue to borrow more than 40 cents of every dollar it spends. Both Republicans and Obama see politically toxic debt limit vote as a way to take advantage of an opportunity to reduce future deficits – a trait that seems to be to political advantage for both sides.

But GOP refusal to consider devoting any new revenue from closing tax loopholes – will that oil and gas company enjoying — cutting the deficit has led Democrats to withhold further expenditure cuts in addition to a handful of provisionally agreed to during several weeks of talks led by Vice President Joe Biden in May and June. For their part, say Republicans in the White House offers no expenditure cuts in the short term and retires from some tentative agreements on substances requiring federal workers to contribute more to their pensions.

Also meeting at the White House Wednesday morning to draw up agreements on specific cuts that are discussed in the previous Biden-led talks. Meeting with Obama, Biden and congressional leaders later Wednesday was expected to build on these discussions.

Obama himself folkomröstade efforts Tuesday, telling CBS News anchor Scott Pelley as more than 20 billion dollars in Social security checks may be held up.

"I cannot guarantee that the controls which will go out on 3 Aug. unless we have solved this," said Obama. "It is simply not the money in the Fund to do so."

Capital a 2Q profit, plans $ 2B stock offers

NEW YORK (AP) — Capital one financial Corp. said Wednesday that its second quarter profit climbed 50 percent, as its credit cards improve payment habits and loan customers get the Bank to drastically reduce it had set aside to cover expenses for uncollected.

The company, best known for his strongly advertised credit card activities, also announced the inventory offers a 2 billion dollar. Funds will be used to pay for the Bank's planned 9 billion dollar acquisition of INGS banking unit, announced last month.

News of the offer pressured stocks in midday trade. A share capital slipped 72 cents to $ 51.52 in heavy trading, as the larger markets increase.

McLean, Virginia-based bank said net profit rose to 911 million dollars or $ 1.97 per share, in the three months ended June 30, compared to 608 million dollars, or $ 1.33 per share, a year ago.

Analysts, on average, revenues are expected at $ 1.73 per share, according to data provided by FactSet.

Net interest income, the money was from deposits and loans, increased to 3.12 billion USD 3.1 billion dollars. That was helped by capital acquisition in April by Kohl's credit card portfolio.

The amount which the Bank wrote as uncollectible decreased in the quarter, the net kostnadsfritt-off reduction of 214 million dollars, 2.91% of balances on annualized basis, from 5.35 percent a year ago.

Improving turned capital a dropping 579 million dollars from the reserves had been set aside for future depreciation. Sterne Agee, said analyst Henry Coffey release adds approximately 81 cents to earnings per share for the period.

Total loans at the end of the quarter increased 4 percent to $ 4.9 billion, driven largely 3,7 billion dollars contributed to Kohl, along with growth in auto finance and commercial banks. Coffey noted that credit card balances have dropped during the quarter.

Non-ränteintäkter or money earned from fees and charges, climbed to 857 million dollars from 807 million dollars.

Capital a, which is known for his advertising campaign "what's in your wallet?" said marketing expenditure increased to 329 million dollars from 219 million dollars during the quarter.

The company said that stocks offer subject to forward sale agreement with Barclays Capital and Morgan Stanley.

Capital one provides the underwriters a 30-day option to purchase up to an additional $ 300 million shares to cover any excess demand.

_____

AP Business writer Michelle Chapman in New York contributed to this report.

Google social network is to maintain leadership

NEW YORK (AP) — Google is not building its new Plus service simply to have an online hangout Facebook.

Google's new social networking endeavor is, rather, if you try to gain valuable insight into people's lives and relationships. This could help the company do a better job of targeting criteria ads so that advertisers would pay more and have less reason to spend their money on Facebook.

If it succeeds, Plus represents Google's best shot yet at muscling into a market that has threatened to bring down the Internet search and advertising leader, as Facebook leads the way in making the online world of social.

In addition, Google's carefully scripted venture to a territory where its previous efforts have been duds.

On the surface, Plus similar to Facebook – with a Google touch. It lets people share photos and status messages, chat with friends and acquaintances and follow the News. A prominent feature called circles, you can organize the people they interact with in groups, family, close friends or fishing buddies. Users can choose to share stuff only among certain circles.

Google Plus is still in a limited test phase, and invites to join is much sought-after. Only time will tell if it takes the public or if there is too little, too late to face off with Facebook and Twitter in the social sphere – just as Microsoft has managed to surpass Google in search, with latecomer Bing.

Google Inc. has done quite well without their own social networks. Its online Search engine accounts for two-thirds of the issues in the United States, and even more in parts of Europe. Revenues are expected to be higher than the 36 billion dollars this year, most of it from text ads that appear alongside search results and other Web content. Google reports its latest quarterly results Thursday.

Online behaviors are changing, however. People spend more time on Facebook and other social networks. They are relying increasingly on their friends ' recommendations when choosing where to eat and which movies to watch.

Google, meanwhile, the bungled previous social media efforts. Share Wave killed quickly because users do not know what to make of it. Buzz, a later company, was the center of a privacy fiasco. Google had been too aggressive automatically create circle of friends, who unwittingly revealed who they've corresponded with in Gmail.

Early responses on Google Plus has been positive. But there is no guarantee of success. When Google botched a social media effort after another, Facebook grew exponentially.

Today is sign half of Facebook's 750 million worldwide users in to the site every day. That's about the entire population of the United States and the business areas combined. More than 250 million people participate with Facebook in any form on external websites every month around the world. They do this by clicking on the ubiquitous "like" and "recommend" buttons on news and other Web sites or by logging in to sites using their Facebook password.

Google's Chairman and former CEO, Eric Schmidt, has admitted that the company failed to respond to Facebooks hot fast enough. His successor, Google founder Larry Page, has made social networks one of his main priorities since he took office in April.

"We do not think it is a coincidence that (Google Plus) was introduced less than three months after the page returned to the CEO post," said Standard and poor's equity analyst Scott Kessler in a note to clients.

Facebooks main advantage is the enormous trove of information that shared its users about themselves through about 4 billion posts and connections that they collectively every day. Facebook knows what people read, eat and watch. It knows who are friends with whom, what friends people trust recommendations about what shoes to buy and which plumber to hire.

Google cannot index the most information on its search engine because Facebook don't share it. Instead, Facebook incorporated a search partnership with Google rival Microsoft Corp. In may, Microsoft's Bing search engine started to use information from people's Facebook settings to modify your search results. This means Facebook users who are looking for shoes or concert tickets on Bing can get results that are tailored to the interests on the Web site. For people who are not signed in to Facebook when they are looking for, perhaps Microsoft's search engine still highlight the links that other Facebook users have recommended.

Google gives a disadvantage. Unless it can obtain similar data by using a social services own, left Google with a formula that sorts through the pattern of Web links, and other computer data to determine whether a site should rank in its recommendation. The system has become increasingly vulnerable to manipulation of the sites that rank higher than their competitors. Google search results can therefore not be as useful as recommendations from an analysis of what they have already signalled that they want by pressing a Facebook button.

There is another important way that the social tasks can help Google.

On Facebook, companies can focus their advertising with razor-sharp precision, given to all types of information that people like parts, such as a preference for Coke over Pepsi or if they have ever been married. They may, for example, show a certain Blog ad only to single men aged 17-41, who lives in New York, is Yankee fans and enjoy the "World of warcraft" video games.

"It is the largest telephone cards to Facebooks marketers," says Debra Aho Williamson, principal analyst with eMarketer.

Advertisers are usually willing to pay more for such an approach because they were pitching consumers most likely to buy. Google is doing a good job already targeting ads based on what people search for write on e-mail messages and watch YouTube. Social data could help Google do even better.

Danny Sullivan, who follow Google closely as Chief Editor for the Web site Search Engine Land, said that Google about Google Plus succeed, would have "a good insurance" between the growth of social networks.

The need became apparent when Google's deal to include Twitter updates into their search results expired recently, said Sullivan. Google has temporarily shut down its "real-time" search feature, although it said users stay tuned while it explores how Google Plus will figure into it.

That said, Google Plus does not need to necessarily be a Facebook clone.

"Google needs to have a social strategy that is relevant for Google and how people use Google applications," says Susan Etlinger, analyst at altimeter Group. "It is very different from how people use Facebook. "

Facebook is currently an online hangout in particular. People, it is possible to scan status updates, chat with a friend or watch the latest screenshots, without necessarily having a specifically in mind.

With Google, people usually a case of looking for a hair stylist, or send an e-mail message about an upcoming party. Google's mission is to make their existing products social as "social" is becoming the norm for online activity, she said.

"Eventually everything will be a social network," said Etlinger. "Social features will in all things on the Web."

Midday glance: construction company

NEW YORK (AP) — Shares of some top construction companies are mixed at 13.00:

Fluorine increased $ 1.49 or 2.3%, to $ 65.58.

FosterWhl increased $. 29, or 1.1 percentage points to $ 27.56.

Quanta services increased $. 49 or 2.5% to $ 20.11.

Shaw Group fell $ 26, or 1.0%, to $ 27.01.

Guilty pleas in hint at the next stage in insider case

NEW YORK/BOSTON (Reuters)-a new round of insider trading indictment includes hedge funds, be in the works, to judge by some unusual Name-dropping during two last guilty pleas in the protracted probe.

Two previous research consultants told a Manhattan federal judge that they gave confidential company information to traders on the three medium-sized hedge funds: STG capital, G-core capital and Kingdom Ridge capital. STG and G-Core closed both late last year after a string of FBI raids and lawsuits on hedge funds related to trade missions.

None of the three funds has been accused of wrongdoing. Publication of their names suggest, however, on a road map that prosecutors may qualify, as they continue to pursue allegations of illicit trafficking with $ 2 trillion hedge fund industry.

Naming of economic agents could be intended to put pressure on them or others to plead guilty or to submit information, say legal experts. Office of Manhattan U.S. Attorney Preet Bharara has recently won a string of insider trading cases, including the conviction in May of single hedge fund billionaire Raj Rajaratnam, and secured many guilty pleas in trade missions.

"This is the use of a plea allocution to signal the ship sailing and to obtain the named persons to cooperate in order to make others," Daniel Richman, professor at Columbia Law School, said of airing of the producers ' names.

RAISING EYEBROWS

Consultants Mark Longoria and Walter Shimoon, who both worked for "experts networking" company's primary global research, have both acknowledged they left the hedge fund traders with tips about technology company earnings and sales trends. Longoria pleaded guilty on June 30, Shimoon on July 5.

Former prosecutors say it is rare for defendants pleading guilty to be so open about identify others who may have been used for crime, but has been accused of them.

In fact the official procedure manual for U.S. Attorney says "it is not generally appropriate" for a Prosecutor to identify a zero rate "wrongdoer" during a plea proceeding. The manual also says that a Prosecutor should not be "causes a defendant" pleading guilty to name that person either.

Ellen Davis, a spokeswoman for Bharara, declined to comment.

Both Longoria and submitted their pleas before Shimoon United States District Judge Jed Rakoff, who has a reputation to make tough issues and operates the defendants to be as accommodating as possible during the plea hearing.

The name Kingdom Ridge capital was provided by a Prosecutor in response to a question by Rakoff as Shimoon seemed to have had problems with that answer. The judge's questions may have inadvertently help prosecutors to obtain the names of traders in the court records that may have otherwise been secret.

"It is the best possible world where the Prosecutor to be named but is hamstrung by the rules," the former Brooklyn, New York, Federal Prosecutor Winston Chan, who is not involved in the case, said if the publication of the names. Chan is now a lawyer at the law firm Gibson, Dunn & Crutcher/LLP.

A jury in June sentenced Winifred Jiau, another former primary global consultancy, providing traders with inside tips. Earlier this year, prosecutors secured the required bases from two former portfolio managers on the trader's Steven Cohen hedge fund SAC capital advisors, along with a number of other former primary global consultants.

Prosecutors have not made any allegations of improper trade against Cohen or someone currently associated with his Stamford, Connecticut-based fund.

Prosecutors have much material to go through as they investigate. In court filings, they talked defense lawyers they have raised more than 1 800 audio tapes, and e-mail from 100 persons in their probe to the expert network industry, firms that specialize in matching hedge funds with industry consultants. Also, more than two dozen hedge funds have received lawsuits, sources said.

According to testimony from an FBI agent filed on Tuesday, received government approval in December 2008 to record telephone conversations by Richard Grodin and Dipak Patel, both former portfolio managers SAC capital. Neither has been charged criminally. They could not be reached for comment on Wednesday.

EXPERTS WITH LARGE NETWORKS

Longoria, a former Advanced Micro Devices Inc. employee, said he provided confidential information to Steven glass, founder of STG capital, a one-time fee of $ 200 million Fund focused on technology.

He also said that he gave information to the "Gurinder by G-core." G-Core, a fund set up by Ian Goodman, a former top traders with SAC capital, also concluded last year. Goodman's first hires at the G-Core was traders Gurinder Kalra.

Calls to STG capital and G-Core was not returned.

In January, told Reuters that his company's glass relationship with primary global did not play any part in his decision to shutter the Fund. He did not respond to e-mail this week seeking comment.

Goodman, once a top trader of Cohen's SAC capital, launched G-Core 2008 with around 200 million dollars from investors.

During his undergraduate says Shimoon, a former employee, Flextronics he had shared information with a trader named "Nick" at White Plains, New York hedge fund.

Under prodding by Rakoff, American identified Prosecutor Antonia Apps trader Nicholas Caputo, employed by UK Ridge capital, another hedge fund formed by people who had previously worked at SAC capital.

Glenn Colton, a lawyer for Kingdom Ridge, said hedge fund was surprised Shimoons basis.

"There was simply no reason for an innocent party UK Ridge named on an unfair and misleading way," said Colton.

Shimoon also said he worked for John Kinnucan broadband research. Late last year, rejected the Kinnucan Overtures by FBI agents to wear a wire and help with the case, the insider-trading. Kinnucan has told Reuters that he did anything wrong and that he collected on technology companies on marketing trends and new products were eligible.

(Reporting by Svea Herbst-Bayliss and Basil Katz, editing by Matthew Goldstein, Martha Graybow, and Matthew Lewis)