WASHINGTON – Federal regulators are scrutinizing a type of mutual fund that’s potentially riskier than conventional funds and is growing in popularity, prompting concerns over possible harm to ordinary investors.
The Securities and Exchange Commission has disclosed that it’s conducting a “national sweep exam” of so-called alternative mutual funds, focusing in a first phase on 15 to 20 groups of funds. The SEC official who heads the agency’s investment fund division says the review looks at the funds’ ready assets and oversight of them by fund boards.
The alternative funds use investment strategies similar to those employed by hedge funds, which can include commodities and complex derivatives as well as ordinary stocks.
Detroit-area rainfall slows auto production
DETROIT – Record-setting rainfall in the Detroit area has slowed vehicle production, automakers said Tuesday.
Chrysler reopened its Sterling Heights Assembly Plant, which makes the Chrysler 200 sedan, on Tuesday afternoon but had to send workers home because of high absenteeism.
Three other Chrysler plants, in Detroit and in the suburbs of Warren and Sterling Heights, were running but at a slower rate than usual Tuesday evening, the company said.
Flood damage also forced General Motors to close its Tech Center in Warren on Tuesday morning.
U.S. corn harvest set to break record
DES MOINES, Iowa – Farmers will produce a record-breaking corn harvest this year, surpassing earlier expectations of the U.S. Department of Agriculture, which on Tuesday revised upward its estimate of this year’s corn crop to 14 billion bushels to exceed last year’s 13.9 billion bushel record.
A bigger crop was expected as adequate rain and cool temperatures made for favorable growing conditions in the 18 states that produce 91 percent of the nation’s corn. The abundant harvest has driven prices lower, prompting farmers to take more control of their grain marketing by building more on-farm storage, holding on to the crop and timing the sale to maximize profit.
The USDA said the amount of corn produced from each acre will reach a new nationwide average of 167.4 bushels, up from the earlier spring estimate of 165.3 bushels. The record 164.7 bushels-per-acre average was set in 2009.
Soybean production also will set a record of 3.8 billion bushels, the USDA said, confirming its earlier prediction. The previous record was 3.4 billion bushels in 2009.
Stocks slip following two days of gains
NEW YORK – Stocks closed lower following two days of gains as investors focus on problems in Ukraine and Iraq.
Energy stocks fell more than the rest of the market, dragged down by a decline in the price of crude oil.
The Dow Jones industrial average lost nine points, or 0.1 percent, to close at 16,560 Tuesday. The Standard & Poor’s 500 index fell three points, or 0.2 percent, to 1,933.
The Nasdaq composite fell 12 points, or 0.3 percent, to 4,389.
Kate Spade plunged 25 percent after executives for the handbag company warned that sales growth would slow this year.
U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 2.45 percent.