NEW YORK

Market volatility fuels 280-point decline

NEW YORK — Volatility returned to Wall Street on Tuesday, sending stocks plunging as investors grew more uneasy about the economy and whether the Federal Reserve will take the steps needed to prevent credit market problems from spreading. The Dow Jones industrials fell 280 points.

The stock market found little to assuage concerns in minutes from the Fed's last meeting, released during afternoon trading. The major indexes' losses steepened after investors parsed the minutes for signs of a possible interest rate cut.

There had been some hope on the Street that Fed policymakers might have sent a stronger signal that they were more willing to cut interest rates to help calm turbulent market conditions. But in the minutes from the Federal Open Market Committee's Aug. 7 meeting, while the central bank noted the turmoil in the markets and said, "to the extent such a development could have an adverse effect on growth prospects, might require a policy response," it didn't discuss a cut in the benchmark federal funds rate that Wall Street has wanted.

The Dow fell 280.28, or 2.10 percent, to 13,041.85, its biggest drop since Aug. 9. Stocks rose in fairly subdued trading last week, but began to pull back Monday on sluggish economic data.

Broader stock indicators were also lower. The Standard & Poor's 500 index was down 34.43, or 2.35 percent, at 1,432.36, and the Nasdaq composite index shed 60.61, or 2.37 percent, to 2,500.64.

Credit card defaults, bankruptcies rising

NEW YORK — With more Americans filing for bankruptcy again after last year's hiatus, credit card default rates are spiking.

Although the percentage of payments being written off as uncollectable isn't as high as it was a couple of years ago, the conditions are ripe for it to catch up. Bankruptcy filings keep pouring in, home prices continue to fall and energy prices remain high.

According to data from Moody's Investors Service, credit card companies wrote off 4.58 percent of payments from January through May, up nearly 30 percent from the same period in 2006. "In 2007, we expected an increase as bankruptcy filings returned to more normal levels," said Jay Eisbruck, managing director in Moody's Investors Service Asset-Backed Finance Group.

According to the Administrative Office of the U.S. Courts, the nation's bankruptcy filings jumped 66 percent in the first quarter. That's causing default rates to soar because getting bankruptcy protection usually means that you're released of your credit card obligations.

Futures fluctuate; refinery concerns fade

NEW YORK — Energy futures fluctuated Tuesday as concerns about refineries faded and OPEC suggested that the oil cartel sees no need to boost production. Gasoline futures have risen in recent days as a number of refinery outages rekindled concerns about fuel supplies.

"The driver here for the past three or four sessions has been gasoline," said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Ill.

But several of the refinery problems, including a reported outage at Citgo Petroleum Corp.'s refinery in Corpus Christi, Texas, are being quickly resolved. A Citgo spokesman said the company does not comment on operational issues, but Ritterbusch said, "Apparently, those units are in restart."

Also, a crude distillation unit at Valero Energy Corp.'s refinery in Port Arthur, Texas, has been restarted, although at a lower rate after downtime of about a week. And Dow Jones Newswires reported that the processing units at a 330,000-barrel-per-day Chevron Corp. refinery in Mississippi have returned to service.

Gasoline for September delivery fell 2.16 cents to $2.0177 a gallon on the New York Mercantile Exchange, while October light, sweet crude fell 7 cents to $71.90 a barrel.

At the pump, gas prices slipped 0.1 of a cent overnight to a national average price of $2.745 a gallon, according to AAA and the Oil Price Information Service.

NEW JERSEY

Medco to pay $1.5 billion for PolyMedica

TRENTON — Medco Health Solutions Inc., the country's largest prescription benefit manager, said Tuesday that it will pay $1.5 billion in cash for PolyMedica Corp., long the largest U.S. supplier of diabetes treatment products.

Buying PolyMedica, which has nearly 1 million patients and includes the Liberty Healthcare brand, expands Medco's foothold in a fast-growing drug category worth more than $25 billion a year.

Medco already has 2.8 million customers with diabetes — more than one-quarter of all insured diabetics. With the purchase, the company could eventually treat half the nation's insured diabetics, said David Snow, Medco's chief executive.

OHIO

Wendy's maneuvers for possible sale

COLUMBUS — Wendy's International Inc. has agreed to let a major shareholder have access to crucial information about the third-largest hamburger chain so he can decide whether to bid for the company.

Billionaire investor Nelson Peltz has said his company, Triarc Cos., which owns fast-food chain Arby's, would be a natural buyer for Wendy's. He said last month that he was ready to offer $37 to $41 per share in a deal that would peg Wendy's total value between $3.2 billion and $3.6 billion.

Wendy's agreed to provide Peltz with confidential and proprietary information, according to a letter filed Tuesday with federal regulators.

TEXAS

Whole Foods lines up financing for deal

DALLAS — Whole Foods Market Inc. said Tuesday that it has lined up financing to complete its $565 million purchase of rival Wild Oats Markets Inc., ending a six-month battle against federal regulators who tried to block the deal on antitrust grounds.

The company said it took out a five-year, $700 million loan to fund the deal, which also includes the assumption of $137 million in Wild Oats debt.

"While closing this merger has taken longer than we anticipated, we are very excited to now begin the integration process," said John Mackey, Whole Foods' chairman and chief executive. He said the deal "will result in a company that is much stronger and better positioned for the future."

GEORGIA

EarthLink to cut 900 jobs to reduce costs

ATLANTA — Internet service provider EarthLink Inc. announced Tuesday a plan to cut 900 jobs, or about half of its work force, and close four offices as part of a restructuring plan aimed at reducing operating costs.

The restructuring will begin immediately and be completed by the end of the year, said Rolla Huff, the Atlanta-based company's president and chief executive. More cuts could be announced before the end of the year, he said.