AP Executive Morning Briefing

The top business news from The Associated Press for the morning of Friday, January 19, 2007:

IBM Posts Big Fourth-Quarter Profit Rise

International Business Machines Corp. rode cost cuts and software acquisitions to healthy fourth-quarter profits, and the company posted a blockbuster number for contract signings. But investors found reasons to be disappointed, sending IBM stock down more than 5 percent. The earnings report released Thursday showed an 11 percent gain in net profit, to $3.54 billion, or $2.31 per share, on revenue of $26.3 billion.

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House Rolls Back Oil Company Subsidies

WASHINGTON (AP) _ The House rolled back billions of dollars in oil industry subsidies Thursday in what supporters hailed as a new direction in energy policy toward more renewable fuels. Critics said the action would reduce domestic oil production and increase reliance on imports. The energy legislation was the last of six high-priority issues that House Speaker Nancy Pelosi, D-Calif., had pledged to push through during the first 100 hours of Democratic control. The bill passed by a 264-163 vote.

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Oil Prices Fall to $50.40 a Barrel

SINGAPORE (AP) _ Oil prices fell in Asian trading Friday after the U.S. Energy Department said U.S. crude inventories rose by the most in more than four years. Light, sweet crude for February delivery dropped 8 cents to $50.40 a barrel in electronic trading on the New York Mercantile Exchange mid-afternoon in Singapore. Overnight in New York, the contract briefly fell below $50 a barrel for the first time since May 2005 before settling at $50.48.

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Delta to Discuss US Airways' Bid

ATLANTA (AP) _ Delta Air Lines Inc. plans to discuss US Airways' increased bid to buy Delta with its board of directors soon, the company said Friday as it filed an amended reorganization plan that details how it would satisfy claims against its subsidiary, Comair. Beyond that statement, the nation's third largest carrier offered no new insight into the fate of a hostile bid by Tempe, Ariz.-based US Airways Group Inc. to buy Delta in a deal valued at $10.2 billion.

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South American Leaders Focus on Poor

RIO DE JANEIRO, Brazil (AP) _ Lifting South America's poor masses from misery is a top priority for the Mercosur trade bloc, leaders said during a summit that ends Friday. But how to cut poverty _ through aggressive socialism that rejects U.S. economic models or a more cautious approach _ is disputed. Venezuelan President Hugo Chavez, who is using his nation's oil riches to dole out profits to his nation's poor as well as needy people across the Americas, said that his version of "21st century socialism" is the solution.

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Key Issues Remain in U.S.-S.Korea Talks

SEOUL, South Korea (AP) _ The chief U.S. negotiator in free trade talks with South Korea expressed optimism Friday that the two countries can achieve their goal of an ambitious deal, though acknowledged key hurdles remain amid a looming deadline. "There are tough issues on the table in this negotiation, there's no doubt about it," Assistant U.S. Trade Representative Wendy Cutler told a press conference on the final day of the sixth round of talks.

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McDonald's Opens Drive-Thru in Beijing

BEIJING (AP) _ McDonald's Corp. opened its first drive-thru in Beijing on Friday, launching a partnership with a major Chinese oil company to set up dozens of drive-thrus to exploit the country's growing taste for both cars and Western fast food. The Beijing drive-thru is McDonald's 16th in China but the first in its venture with China Petroleum and Chemical Corp., which McDonald's China CEO Jeffrey Schwartz said would open 25 to 30 more in the next 12 to 18 months.

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Bernanke Warns Budget Could Hurt Economy

WASHINGTON (AP) _ Federal Reserve Chairman Ben Bernanke told Congress Thursday that the economy could be gravely hurt if the nation's fiscal house is not put in order and Social Security and Medicare aren't revamped. "If early and meaningful action is not taken, the U.S. economy could be seriously weakened," Bernanke said in prepared testimony to the Senate Budget Committee.

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Interest Rates, Apple Lead to Sell-Off

NEW YORK (AP) _ Wall Street retreated Thursday, falling amid vanishing hopes for an interest rate cut and an unimpressive forecast from Apple Inc. that muted investors' enthusiasm for technology stocks. The technology-laden Nasdaq composite index declined 36.21, or 1.46 percent, to 2,443.21 _ its biggest one-day drop since Nov. 27, when it fell by 2.21 percent. The Nasdaq is still up more than 1 percent on the year, however. Dow Jones industrial average slipped 9.22, or 0.07 percent, to 12,567.93. The Standard & Poor's 500 index fell 4.25, or 0.30 percent, at 1,426.37.

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GE Buying Part of Abbott's Diagnostics

HARTFORD, Conn. (AP) _ General Electric Co. will acquire part of Abbott Laboratories' diagnostics business for $8.13 billion in cash, the two companies announced Thursday. The addition of Abbott's primary in vitro diagnostics and point-of-care diagnostics businesses will broaden GE's $16 billion health care business, which has moved into health care information technology and molecular diagnostics in the past few years.

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Gold Prices

HONG KONG (AP) _ Gold closed at $628.30 an ounce on Friday in Hong Kong, down $6.40 an ounce from Thursday's close of $634.70.

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Japan Markets

TOKYO (AP) _ Japanese stocks fell Friday as investors took a breather after the market hit a nine-month high the previous day. Bank, oil and electronics stocks declined.

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Dollar-Yen

TOKYO (AP) _ The dollar inched up against the yen in Asia Friday as Japan's finance minister said that the yen's exchange rate is in line with economic fundamentals.

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