Business Briefs

Slip in home sales ends rally in stocks

NEW YORK — Wall Street abruptly ended an earnings-driven rally and closed sharply lower Thursday after a steeper-than-expected decline in existing home sales helped chill the market's recent optimism.

The National Association of Realtors said sales declined in June after a slight rebound in May. Existing home sales fell 2.6 percent in June, well beyond the 1 percent drop economists had forecast.

The Dow Jones industrial average fell 283.10, or 2.43 percent, to 11,349.28, erasing the nearly 170 points added in the two prior sessions.

Broader indicators also declined. The S&P 500 index fell 29.65, or 2.31 percent, to 1,252.54. The Nasdaq composite index fell 45.77, or 1.97 percent, to 2,280.11.

Slowing economy hits lodging giant

NEW YORK — Starwood Hotels & Resorts Worldwide Inc. reported a better-than-expected 16.4 percent drop in second-quarter profit Thursday and cut its full-year outlook, citing a weakening U.S. market.

Net income for the three months ended June 30 fell to $105 million. Revenue per available room, a key gauge of a lodging company's performance, gained 6.8 percent at properties open at least a year.

Three home lenders being investigated

LOS ANGELES — A federal grand jury is investigating mortgage lenders Countrywide Financial, New Century Financial and IndyMac Bancorp, a person familiar with the situation told the Associated Press on Thursday.

Subpoenas seeking documents have been issued to the three companies, according to the person, who was not authorized to speak publicly about the case and requested anonymity.

The probe signals that prosecutors are investigating whether fraud and other crimes contributed to the mortgage crisis that led to the demise of the three California-based lenders.

Earnings improve at MeadWestvaco

RICHMOND, Va. — Packaging and specialty chemicals maker MeadWestvaco Corp. said Thursday that its second-quarter profit jumped 75 percent as stronger emerging market sales helped offset "unprecedented input cost inflation."

For the quarter ended June 30, earnings were $56 million, or 33 cents a share. Analysts expected earnings per share of 19 cents. Revenue from continuing operations climbed 8 percent to $1.71 billion.

MeadWestvaco sold its North Charleston paper mill earlier this month for $485 million.

It maintains local operations in its forestry, land planning and chemical units.

Satellite radio deal set to get FCC's OK

WASHINGTON — Approval of a merger of the nation's only two satellite radio companies was imminent Thursday after the pair agreed to pay $19.7 million to settle charges they violated federal rules.

Sirius Satellite Radio's buyout of rival XM Satellite Radio has been before the Federal Communications Commission for 16 months.

The five-member FCC is deadlocked at 2-2, but Deborah Taylor Tate is expected to cast the deciding vote clearing the deal once a decree outlining the enforcement action is circulated.