April 29, 2004

Economy Grows at 4.2
Percent Rate in First Quarter



The economy grew at an annual rate of 4.2 percent in the opening quarter
of 2004, indicating a business recovery, the Associated Press reported.
The reading on gross domestic product for the January-to-March quarter,
reported by the Commerce Department today marks a slight pickup from the
4.1 percent rate registered in the final quarter of 2003. While the
first quarter figure suggests that the recovery is in good shape, it
fell short of the strong 5 percent pace that economists were
forecasting. Economic growth in the first quarter was bolstered by
spending by consumers, business and the federal government, the newswire
reported.

Unions Seek 'Front-End'
Spending For Asbestos Fund



Labor unions attempting to negotiate legislation overhauling the
asbestos litigation system are seeking more 'front-end' money for a
trust fund that would be used to compensate asbestos victims,
CongressDaily reported. 'It's difficult to see how [that
position] moves things forward,' one source said about the suggestion,
made during negotiating sessions this week among various industry
stakeholders and congressional staff.



Lawmakers and stakeholders agreed to try to resolve differences during
sessions this week moderated by a retired federal judge, although
congressional and industry sources said those sessions have so far
yielded little progress. Republican and Democratic leaders suggested
that talks would continue through the week, although more sessions may
be scheduled, the newswire reported.

Nortel Fires CEO in Accounting
Probe

Nortel Networks Corp. fired its top three executives
on Wednesday and said accounting problems already under investigation by
regulators ran deeper than expected, Reuters reported. The surprise
announcement from the maker of telecommunications equipment sent its
shares down as investors speculated that an account review begun last
year was developing into a financial scandal. The Brampton, Ontario
company said it expected the restatement to cut 2003 earnings by 50
percent, but losses for previous years would be reduced. It had reported
an unaudited 2003 profit of $732 million in January. It said
first-quarter results due today would be delayed, Reuters
reported.

Halliburton Posts Loss As
Asbestos Charge Weighs

Halliburton Co. on Wednesday reported  a
quarterly loss, reversing a year-ago profit as charges for a proposed
asbestos settlement continued to weigh, Reuters reported. The oilfield
services company posted a net loss of $65 million, or 15 cents a share,
in the first quarter, compared with net income of $43 million, or 10
cents a share, a year earlier. It reported a profit from continuing
operations of 17 cents per share, hurt by an additional 14 cent per
share charge to settle claims related to its Barracuda-Caratinga
deepwater oil project in Brazil. Excluding the Brazilian project charge,
the per share earnings matched analysts' consensus forecast of 31 cents
a share, according to Reuters Research.

Enron, AEP Settle Natural Gas
Facility Dispute

American Electric Power Co. Inc. (AEP) on Wednesday
said it will pay $115 million to buy Enron Corp.'s interest in a natural
gas storage reservoir, ending a lawsuit that started from Enron’s
bankruptcy, Reuters reported. The Columbus, Ohio-based utility bought
the Houston Pipe Line Co. from Enron and entered into a 30-year pre-paid
lease for the related Bammel gas storage facility for $726.6 million in
June 2001. But Enron filed for bankruptcy six months later, and the
lease became part of the Houston energy conglomerate's chapter 11
proceedings, leaving AEP out the $274 million it paid for the lease, the
newswire reported.

Asbestos Legislation? Motion
Denied

Despite months of negotiations
involving labor, business, lawyers and senators, a federal solution to
the costly asbestos litigation clogging the courts still seems elusive,
the National Law Journal reported. Last year's optimism that
a consensus could be found has been tempered by an election-year
environment in the Senate that some say is not conducive to any
legislation passing. Says attorney Steven Kazan: 'There has been a great
deal of movement. It has all been in the wrong direction.' Read
the 
href='http://www.law.com/jsp/pc/LawArticleLit.jsp?id=1082923358449'>full
article  (subscription required).

Comcast, Time Warner May Link
on Adelphia

Comcast Corp., which on Wednesday abandoned a hostile
bid to buy Walt Disney Co., now has a range of options open that may
include teaming up with Time Warner Inc. to buy Adelphia Communications
Corp., analysts said, Reuters reported. Wall Street analysts and
investors raced to handicap the potential scenarios. Adelphia, whose
founder is currently on trial for securities fraud, said last week it
would consider a sale of the company, even as it goes through bankruptcy
proceedings. Comcast CEO Brian Roberts told analysts on Wednesday the
company would begin examining new properties to acquire, among them
Adelphia. Roberts said Comcast would look to either buy, swap or partner
with another company to buy cable systems from the bankrupt Adelphia,
the newswire reported.

Oglebay Files Chapter 11 Plan,
Gets Credit Line

Oglebay Norton Co., a producer
of minerals and industrial materials, on Wednesday said it filed a
chapter 11 reorganization plan with the bankruptcy court in Wilmington,
Delaware, Reuters reported. The Cleveland, Ohio-based company also said
the court approved a $305 million debtor-in-possession credit facility.
Oglebay said it will use proceeds to pay down other debt and to help the
company run during and after it emerges from bankruptcy. Oglebay said a
group of lenders led by Silver Point Finance LLC provided the new DIP
facility.

Alitalia Grounded By
Strike, Awaits Government Move

Alitalia grounded its entire fleet today as workers
staged a 12-hour strike to put pressure on the government to intervene
and save the state-controlled airline from bankruptcy, Reuters reported.
The stoppage followed a wildcat walkout on Wednesday and left thousands
of passengers stranded around Italy. Prime Minister Silvio Berlusconi's
cabinet met on Thursday to discuss a long-promised package of measures
designed to support the airline, but it was not clear if ministers would
approve the plan or yet again postpone a decision, the newswire
reported.

Airlines Attribute Slow
Recovery to Security

The U.S. airline industry said on Wednesday it slow
recovery is at risk because the administration wants carriers to pay an
additional $400 million for security, Reuters reported. 'The health of
the industry remains fragile,' Jim May, chief executive of the Air
Transport Association, told reporters at a news conference. May said
U.S. airlines are projected to lose between $2 billion and $3 billion in
2004. That is substantially less than actual losses for the previous
three years, the newswire reported.

But some in Congress and industry critics complain the
industry has done well since the attacks, with Congress approving
financial help that included a $15 billion package of cash and loan
guarantees in 2001 and pension relief worth roughly $1 billion this
spring, Reuters reported.