New York

Market closes flat as investors juggle news

Wall Street closed essentially flat Thursday after struggling to resume a modest upward trend while investors juggled upbeat economic data, divergent earnings reports and a pullback in Chinese stocks. The Dow Jones industrials edged higher to a record close for the second straight day.

While a mix of profit reports pushed and tugged at stocks Thursday, investors also watched markets abroad, where stocks fell following word that economic growth in China's first quarter jumped a higher-than-expected 11.1 percent and inflation increased at the fastest pace in more than two years. Chinese officials said they would take steps such as raising interest rates to curb growth.

Wall Street fell at the opening, then began to pare its losses after a research group said its barometer of future economic activity rose slightly in March, signaling modest growth in coming months. The Conference Board said its index of leading economic indicators rose 0.1 percent, as expected, to 137.4 in March. The reading follows two straight months of declines.

The Dow rose 4.79, or 0.04 percent, to 12,808.63 its sixth straight gain. On Wednesday, the Dow reached fresh trading and closing highs, perhaps signaling a recovery from a late February pullback that was in part triggered by a sell-off on the Chinese market. Wednesday's trading high of 12,838.46 and that session's close broke records set Feb. 20.

Broader market indicators dipped Thursday. The Standard & Poor's 500 index fell 1.77, or 0.12 percent, to 1,470.73, a day after the S&P hit a 61/2-year high. The Nasdaq composite index fell for the third straight session, slipping 5.15, or 0.21 percent, to 2,505.35.

Bond prices fell after three straight sessions of gains following the release of decent economic data and some robust earnings reports. The yield on the benchmark 10-year Treasury note rose to 4.67 percent from 4.66 percent late Wednesday.

TEXAS

Homebuilder's profits tumble 85 percent

DALLAS D.R. Horton Inc., one of the nation's largest homebuilders, said Thursday that profits plunged 85 percent in the January-March quarter, and its chief executive said the weak housing market would continue into 2008.

Horton was hurt particularly by a slowdown in pricey California, where the number of people able to afford a new home has been shrinking.

The collapse in profits wasn't surprising. The company warned last week that recent orders had dropped by more than one-third and cancellations were still running at high rates.

Investors took the news in stride. Shares of Horton fell just 3 cents, to $23.01, in trading Thursday afternoon on the New York Stock Exchange.

Horton is responding to the housing slump by cutting jobs it has shrunk to 7,300 employees from 10,000 last spring and abandoning deposits on options to buy land.

Horton said net income for the first three months of 2006 fell to $51.7 million, or 16 cents per share, from $352.8 million, or $1.11 per share, a year ago.

Those results included charges of $81.2 million, or 16 cents per share, mostly to write down the value of land options, 80 percent of which were in California.

CALIFORNIA

State committee kills 4-day workweek bill

A bill in the state Assembly that would have let workers individually negotiate four-day workweeks with their employers was killed in committee Wednesday afternoon.

The Assembly's Labor and Employment Committee heard testimony on the bill, which would have changed existing law to let employees work four 10-hour days each week, receiving overtime for any time worked after that 40 hours.

While the bill had support from the state's chambers of commerce, it was opposed by organized labor.

Current law lets companies have four-day workweeks if they are part of union negotiations or if employees take a two-thirds vote to allow modified workweeks. Those in favor of the bill said the existing law is too restrictive and hurts small businesses. Those opposed said the bill would remove some protections for workers.

The committee voted the bill down in a 5-3 vote.

JAPAN

Sony's European video game unit to cut jobs

TOKYO Sony's European video game unit is cutting jobs to grow more competitive, a company spokesman said Thursday, as the just-launched PlayStation 3 machine struggles against rival offerings from Microsoft and Nintendo that beat it to the market.

All Sony Computer Entertainment Inc. employees in Europe totaling about 1,900 people have been told about the plan to cut jobs, but specifics, such as the number of cuts and which jobs will be affected, have not been decided, said Satoshi Fukuoka, the spokesman in Tokyo.

The company has no plans to trim jobs in Japan or North America, he said.

Japan's top business daily, The Nikkei, reported in its Thursday editions that Sony Corp. will be slashing up to 160 jobs. Sony's gaming business was critically hurt by the launch delay in Europe of the next-generation PlayStation 3, the newspaper said.

Fukuoka would not confirm the Nikkei report.

WASHINGTON, D.C.

Magnet danger forces recall of building sets

A recall of Magnetix building sets has been expanded after more children swallowed the tiny magnets in them and were seriously injured, the Consumer Product Safety Commission announced Thursday.

In March 2006 Mega Brands Inc. recalled 3.8 million of the magnetic building sets when one child died and four others were seriously injured after they swallowed the magnets. Thursday's recall includes an additional 4 million sets. In total, the CPSC and Mega Brands know of the one death, one aspiration and 27 intestinal injuries. All but one of the cases required emergency surgery.

The expanded recall includes all sets except Magnetix sets sold since March 31, 2006, that are age-labeled "6+" and have the following caution label: "CAUTION: Do not ingest or inhale magnets. Attraction of magnets in the body may cause serious injury and require immediate medical care."

The newer sets better retain magnets because of material and design changes, according to Mega Brands.

The commission received reports of at least 1,500 incidents in which the small magnets separated from the toy

For more information, call Mega Brands at 800-779-7122.