Sears, Penney sever ties with Paula Deen

Friday, June 28th, 2013 | Finance News

NEW YORK (AP) — The exodus continues.

Sears Holdings Corp and J.C. Penney Co. said Friday that they're cutting ties with Paula Deen, adding to the list of companies severing their relationship following revelations that the Southern celebrity chef used racial slurs in the past.

QVC took a more gentle approach on Friday and announced that it was "taking a pause" from Deen. The home shopping network said that Deen won't be appearing on any upcoming broadcasts and it will phase out her product assortment on its online sales channels over the next few months.

"We all think it's important, at this moment, for Paula, to concentrate on responding to the allegations against her and her path forward," said Mike George, QVC's president and CEO in a letter posted on the company's website.

But QVC left the door open for Deen to return. "Some of you wonder whether this is a 'forever' decision — whether we are simply ending our association with Paula. We don't think that's how relationships work. People deserve second chances."

Sears said it will phase out all products tied to the brand after "careful consideration of all available information."

"We will continue to evaluate the situation," said Amy Diamond, a spokeswoman at the parent company of Sears and Kmart stores.

Both Sears and Kmart sold Paula Deen products.

In an email statement to The Associated Press, Penney just said it decided to discontinue selling Deen-branded products.

The developments are the latest blows to Paula Deen Enterprises.

Earlier this week, Wal-Mart Stores Inc., Target Corp. and Home Depot all announced that they plan to stop selling cookware and other items with Deen's brand.

Meanwhile, on Thursday, Novo Nordisk said it and Deen have "mutually agreed to suspend our patient education activities for now." Deen, who specializes in Southern comfort food, had been promoting the company's drug Victoza since last year, when she announced she had Type 2 diabetes

On Monday, pork producer Smithfield Foods dropped her as a spokeswoman.

Caesars Entertainment also announced that Paula Deen's name is being stripped from four buffet restaurants owned by the company. Caesars said that its decision to rebrand its restaurants in Joliet, Ill.; Tunica, Miss.; Cherokee, N.C.; and Elizabeth, Ind., was a mutual one with Deen.

Last week, the Food Network said that it would not renew her contract.

The stakes are high for Deen, who Forbes magazine ranked as the fourth highest-earning celebrity chef last year, bringing in $17 million. She's behind Gordon Ramsay, Rachael Ray and Wolfgang Puck, according to Forbes.

Deen's empire, which spans from TV shows to furniture and cookware, generates total annual revenue of nearly $100 million, estimates Burt Flickinger III, president of retail consultancy Strategic Resource Group.

But Flickinger says that the controversy has cost her half of that business. He also estimates that she could lose up to 80 percent by next year as suppliers extricate themselves from their agreements.

Still, book-buyers are so far standing by Deen. As of Friday morning, "Paula Deen's New Testament: 250 Recipes, All Lightened Up," remained No. 1 on The book is scheduled for October. Another Deen book, "Paula Deen's Southern Cooking Bible," is No. 2. Several other Deen books were out of stock.


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Pump prices keep falling; oil drops below $97

Friday, June 28th, 2013 | Finance News

NEW YORK (AP) — As the week went along, Americans' commutes got cheaper.

The average price for a gallon of gasoline fell by 6 cents from Monday through Friday, to a two-month low of $3.51 per gallon. The average fell at least a penny in 48 states, with only Hawaii prices gaining a fraction and Idaho's staying flat. The steepest declines were in Indiana (15 cents) and Michigan (14 cents).

A number of refineries that suffered outages in the Midwest in the past month or so returned to operation, easing a shortage of gasoline and dropping prices. The average price has fallen 40 cents in both Michigan and Wisconsin since June 1.

Meanwhile, the price of oil fell Friday for the first time this week, and it finished the second quarter of the year with a slight loss.

Benchmark oil for August delivery fell 49 cents to end at $96.56 per barrel on the New York Mercantile Exchange. For the April-June quarter, oil slipped 67 cents, although it rose 11 percent from a low of $86.68 on April 17.

The decline at the gas pump is good news for drivers as the July Fourth holiday approaches. Most should pay less than on Memorial Day, when gas averaged about $3.65. But this year's June swoon isn't as large as last year's — by Independence Day in 2012, the average price was $3.34.

Brent crude, which is used to set prices for oil used by many U.S. refineries to make gasoline, fell 66 cents to $102.16 a barrel.

In other energy futures trading on the Nymex:

— Heating oil fell 1 cent to $2.88 a gallon.

— Natural gas fell 2 cents to $3.57 per 1,000 cubic feet.

— Wholesale gasoline rose 1 cent to $2.75 a gallon.


US stocks flit between small gains and losses

Friday, June 28th, 2013 | Finance News

NEW YORK (AP) — U.S. stocks were flitting between small gains and losses on Friday, a calm end to the most volatile trading month in nearly two years.

The Dow Jones industrial average was down 39 points, or 0.3 percent, to 14,986 at 2:30 p.m. Eastern Daylight Time. The Standard & Poor's 500 stock index was up less than one point to 1,614.

Investors seemed unsure how to react to recent statements by Federal Reserve officials about the central bank support's for the economy. Mixed economic news Friday added to investor uncertainty after big stock gains so far this year.

"It's a dull Friday," said Gary Flam, a stock manager at Bel Air Investment Advisors. A bull market, he added, is "rarely a straight march up."

The S&P 500 index is still on track to end its best first half of a year since 1998, when it gained 17.7 percent, including dividends. The index has gained 14.3 percent so far this year.

On Friday, consumer confidence was up but a key gauge of business activity in the Chicago area plunged.

"Investors don't know what to make of the news," said John Toohey, vice president of stock investment at USAA Investments. "I wouldn't be surprised to see more ups and downs."

The University of Michigan said its index of consumer sentiment dipped to 84.1 in June from 84.5 the previous month. But that was still relatively high. May's reading was the highest since July 2007.

Meanwhile, the Chicago Business Barometer sank to 51.6 from a 14-month high of 58.7 in May. That was well below the level of 55 that economists polled by FactSet were expecting.

The Dow gained 365 points over the previous three days this week as investors jumped back into the market following a slump last week. That's when Federal Reserve Chairman Ben Bernanke said that the central bank could begin scaling back on its economic stimulus program later this year, providing the economy continues to recover. Since then, other top Fed officials have stressed that the Fed wouldn't pull back its support too soon.

The Dow has had 15 triple-digit moves in June, the most since October 2011.

The Nasdaq composite index was up 13 points, or 0.4 percent, to 3,414.

The yield on the 10-year Treasury note rose to 2.49 percent from 2.47 percent late Thursday. Last month, the yield fell as low as 1.63 percent. Treasury yields help set borrowing costs for a range of consumer and business loans.

In commodities trading, gold gained $12.10 to $1,223.70 an ounce. The price of crude oil fell 49 cents to $96.56 a barrel. The dollar rose against the euro and the Japanese yen.

Among stocks making big moves:

— BlackBerry maker Research In Motion plunged $3.97, or 26 percent, to $11.08 after the company posted a surprise loss in the first quarter and warned of future losses despite releasing its make-or-break smartphones this year. The company also discontinued making new versions of its slow-selling tablet device, The Playbook.

— Accenture fell $8.22, or 10 percent, to $72. The consulting firm cut its revenue and profit outlook for its fiscal year ending in August. Revenue was hurt by lower demand in Europe as well as its communications, media and technology division.

In overseas trading, Japanese stocks rose on news that a key consumer price index stopped falling for the first time in seven months, a sign that the world's third-largest economy is making progress in its battle against deflation. The government also reported that industrial production rose 2 percent, a fourth straight monthly increase. The benchmark Nikkei 225 rose 3.5 percent.