Business in brief: Big boost in April home sales
WASHINGTON – Homebuyers rushed to take advantage of government incentives and low mortgage rates in April, giving the housing market its biggest boost in five months.
But now that a homebuyer tax credit has expired, growth in the second half of the year will depend on the lure of historically low mortgage rates and the strength of the economic recovery.
Sales of previously owned homes rose 7.6 percent to a seasonally adjusted annual rate of 5.77 million, the National Association of Realtors said Monday.
The increase in sales sparked a rise in home prices. The median price for a new home rose to $173,100, up 4 percent from a year ago.
Major trading firms scrutinized
WASHINGTON –Federal regulators said Monday they are looking at whether big trading firms abandoned the market during the massive sell-off on May 6 rather than providing cash support required under law.
Staff of the Securities and Exchange Commission said the possible retreat of big “liquidity providers” during the market plunge is an area of focus in the investigation. Major securities firms are required by law to remain in the market by buying and selling stocks; high-speed electronic trading firms are not.
Some firms that act as liquidity providers stopped doing so during the freefall, the SEC officials found.
Genzyme to pay $175 million
WASHINGTON – Biotech drugmaker Genzyme Corp. has agreed to pay a $175 million penalty to federal regulators in connection with long-standing manufacturing problems that have already cost the company millions.
The payment, which Genzyme disclosed last month when it reported its first-quarter performance, is the return of “unlawful profits” from the sale of products made at the plant, the Food and Drug Administration said in a statement released Monday.
The FDA also said the company signed a legal agreement to fix problems at its biotech drug plant in the Allston neighborhood of Boston. Under terms of the consent decree, Genzyme must map out a plan for overhauling the plant and stick to a preset timetable or face additional fines.
Toyota halts sale of Lexus LS
NEW YORK –Toyota Motor Corp. has stopped sales of the Lexus LS sedan for about three weeks while it works to get parts to dealers to fix a problem with the vehicle’s steering system, a spokesman said Monday.
Toyota on Friday recalled about 3,800 2009 and 2010 LS 460 and LS 600h sedans in the U.S. to fix a problem in which the steering wheel briefly shifts out of alignment with the wheels when it is turned to the extreme right or left and then quickly recentered, such as in a tight U-turn. Toyota said it will remedy the problem by replacing the computer processor in the vehicle’s variable gear ratio steering system.