Business briefs

Published: Tuesday, April 1, 2003 at 6:01 a.m.
Last Modified: Monday, March 31, 2003 at 10:13 p.m.

Market suffers sharp drop amid war fears

NEW YORK - Capping a dreary first quarter, Wall Street suffered another sharp drop Monday amid fears of prolonged fighting in Iraq and a disappointing report on manufacturing in the Midwest. The Dow Jones industrials slid more than 150 points in the market's fourth straight declining session.

The Dow closed out Monday's trading down 153.64, or 1.9 percent, at 7,992.13, amassing a four-day loss of 288.10.

The broader market was also sharply lower. The Nasdaq sank 28.43, or 2.1 percent, to 1,341.17. The S&P fell 15.32, or 1.8 percent, to 848.18.

US Airways emerges

ARLINGTON, Va. - US Airways emerged from Chapter 11 bankruptcy Monday, wrapping up a swift eight-month return to financial accountability just as the war with Iraq threatens to devastate the airline industry.

Airline spokesman David Castelveter said the company has cut annual costs by $1.9 billion a year, mostly through wage and benefit concessions from its workers. The airline also has developed a plan to turn a profit as early as 2004.

However, Castelveter said excitement at the airline was tempered by concern over how the war would affect its restructuring. Bookings were down 20 percent the first week after the war began.

Wachovia faces probe

CHARLOTTE, N.C. - Federal regulators are probing stock purchases by Wachovia Corp. and First Union Corp., focusing on trades that followed the April 2001 announcement of their merger, Wachovia said Monday.

Wachovia, which merged with First Union in September 2001, said the Securities and Exchange Commission was investigating purchases of the two companies' common stocks between 1996 and 2001.

``Wachovia believes all purchases by the legacy companies were in compliance with law, and they were made in accordance with the advice of leading U.S. securities law firms,'' the bank said in a statement.

HealthSouth fires CEO

BIRMINGHAM, Ala. - HealthSouth Corp. fired Richard Scrushy as chairman and chief executive, severing ties with its founder as a third executive pleaded guilty Monday in a mushrooming accounting scandal.

The company said Scrushy, who built HealthSouth into a leading health care chain and was previously suspended as chief executive, also was asked to quit the board.

In a further bid to wipe clean its slate, HealthSouth said it would fire longtime outside auditor Ernst & Young.

The New York-based auditing firm said it was cooperating in a federal investigation of HealthSouth, which allegedly created false financial statements and accounting entries to deceive auditors.

Kmart cutting 660 jobs

ROYAL OAK, Mich. - Kmart Corp. is eliminating 660 more jobs as part of the bankrupt retailer's efforts to cut costs and reduce the size of its operations.

Some 400 jobs will be cut at headquarters, 123 corporate positions will be cut around the country and another 137 vacant positions will be eliminated, the company announced Monday.

Julian Day, Kmart president and chief executive, told a news conference that the 400 headquarters jobs are mostly middle management.

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