CURRENCY
Dollar weakens against other currencies
NEW YORK — The dollar slipped Monday against the euro even as problems in Greece highlighted Europe’s debt crisis. The yen and pound also were stronger against the U.S. currency.
European leaders have yet to reach an agreement on additional aid for Greece. Standard & Poor’s on Monday further cut Greece’s credit rating into junk territory, saying there was a significant risk of the country defaulting on its debt.
The euro rose to $1.441 from $1.435 late Friday but fell to a record low against the Swiss franc, which investors consider a safe-haven currency. It tends to rise during periods of geopolitical tension or when investors worry about slowing global growth or, as now, whether Greece will run out of funds.
European finance officials are meeting in Brussels next week to hammer out a deal on extended aid for Greece. The European Central Bank and the German government disagree on how best to contain the crisis, leaving investors worried about the prospects of an agreement.
MUTUAL FUNDS
Investors withdraw $3 billion in May
BOSTON — Investors last month appeared to follow the adage “Sell in May,” interrupting their recent return to the stock market.
They withdrew $2.7 billion more than they deposited into stock mutual funds in May, snapping a four-month string of net deposits that began in January, Strategic Insight said Monday.
Bond funds and funds buying foreign stocks attracted net deposits as investors became less confident about the U.S. stock market amid signs that the economic recovery is weakening, the New York-based fund industry consultant said.
Yet investors have put a net $39 billion into U.S. stock funds during the first five months of 2011.
AIRLINES
$3.4 billion in bag fees collected in 2010
NEW YORK — The government says airlines collected $3.4 billion in baggage fees last year, up 24 percent from 2009.
The fees are typically $50 round-trip for a first checked bag.
Reservation and change fees accounted for an additional $2.3 billion, down 3 percent from 2009.
The add-ons are one of the few bright spots for an industry that is caught between rising fuel costs and customers who expect rock-bottom airfares. Analysts say without the fees, the industry would be losing money.
ACQUISITION
VF buys Timberland for more than $2.2 billion
NEW YORK — Clothing and footwear maker VF Corp., whose brands include Wrangler, Nautica and North Face, said Monday it will buy the boot and clothing maker Timberland Co. for more than $2.2 billion as it seeks to expand its outdoor offerings.
VF plans to make Timberland part of its outdoor and action-sports business, and it said Timberland’s headquarters will remain in Stratham, N.H. With the addition of Timberland, VF’s outdoor and action-sports business, which also includes the brands Vans, Jansport, Eastpak and others, will make up 50 percent of the company’s total revenue. It expects that to grow to 60 percent by 2015.
VF is offering $43 for each Timberland share, a premium of 43.4 percent to Timberland’s closing price last week.
GREECE
Country’s credit rating cut by Standard & Poor’s
ATHENS — Standard & Poor’s cut Greece’s credit rating deeper into junk territory Monday, saying the country is likely to default on its massive debts at least once by 2013, a decision Athens said ignored its efforts to secure continued funding in coming years
The rating agency said the downgrade from B to CCC “reflects our view that there is a significantly higher likelihood of one or more defaults” as the country tries to close yawning financing gaps over the next two years. It said the outlook is negative.
The new cut came days after Greece’s Socialist government unveiled a new austerity program aiming to save around $41 billion in new taxes and spending cuts by 2015, in tandem with an ambitious privatization drive intended to raise some $72 billion.
From wire dispatches and staff reports
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