World Economic

Stocks and the euro fell Wednesday as worries about Europe hang over financial markets. Energy companies fell hard as the price of crude oil plunged 4 percent. The dollar and Treasury prices rose as traders shifted money into lower-risk investments.

Italy’s borrowing rates ratcheted higher and the euro slid below $1.30 for the first time since January, two signs that the debt crisis continues to pressure Europe’s governments. The euro has lost more than 3 percent in three days.

Italy had to pay higher borrowing rates in its last bond auction of the year Wednesday. The euro zone’s third-largest economy paid 6.47 percent interest to borrow euro3 billion ($3.95 billion) for five years, up from 6.30 percent just a month ago. The higher rates make it more expensive for Italy to borrow money and reflect weakening confidence by investors in the country’s ability to repay its debts.

The Dow Jones industrial average fell 132 points, or 1.1 percent, to 11,822 as of noon Eastern. Caterpillar Inc. fell 5 percent, the most of the 30 stocks in the Dow. The Dow is headed for its third down day in a row. It closed at its lowest level in two weeks Tuesday.

The market appears to be in “sell now and ask questions later mode,” said John Canally, investment strategist at LPL Financial. The fear that another bank failure will lead to a wider financial crisis like Lehman Brothers did in 2008 overshadows everything else, he said.

In traders’ minds, a slight drop in the euro or a small rise in Italian government bond yields is seen as a step toward a banking collapse. “Just the hint of bad news becomes `Oh my gosh. The world is going to end,’ ” Canally said.

The Standard & Poor’s 500 index fell 15, or 1.2 percent, to 1,210. The Nasdaq fell 49 points, or 1.9 percent to 2,529.

The yield on the 10-year Treasury note fell to 1.92 percent from 1.96 percent late Tuesday as demand increased for ultrasafe assets. The dollar also rose against other currencies. The euro lost about out penny against the dollar to $1.29.

European markets fell broadly, and the losses accelerated in the last hour of trading. Germany’s DAX dropped 1.7 percent; France’s main stock index fell 3.3 percent.

Energy stocks led the market lower after the price of crude oil plunged $4 to $96 a barrel. Schlumberger Ltd. lost 3.8 percent; Apache Corp. fell 4.3 percent and Cabot Oil & Gas Corp. fell 5.4 percent.

Other commodities prices also fell sharply as investors shed assets seen as being risky. Commodity prices also tend to fall when the dollar rises, since a stronger dollar makes it more expensive for investors using other currencies to buy commodities, which are priced in dollars. Gold and copper lost each 5 percent.

Health care, utilities and consumer staples companies _ all considered relatively resistant to economic downturns _ were little changed. Technology, materials and industrial companies fell the most.

First Solar Inc. plunged 21 percent, the biggest drop in the S&P 500, after the country’s largest solar company slashed its earnings estimate for the year. The solar industry has been hit hard by slower economic growth around the world and as government funding for alternative energy projects has dried up.

Avon jumped 8 percent, the largest gain in the S&P 500. The company announced late Tuesday that its CEO, Andrea Jung, will step down. The cosmetics company has been struggling with erratic financial results and is under scrutiny by regulators.

The Dow is now down 3 percent for the week, while S&P has lost 3 percent. The Nasdaq is down 4 percent.

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NAI DESCO, a commercial real estate firm, today said it will buy Coldwell Banker Commercial’s St. Louis brokerage operation.

The move will increase DESCO’s local property inventory and agents by 50 percent.  The price was not revealed.

The move doesn’t affect Coldwell Banker Gundaker, which is a separate residential real estate company.

Carl Conceller, a founding member of Coldwell Banker Commercial, will join NAI DESCO as a principal.

DESCO, based in Clayton, lists about 200 commercial properties and Coldwell about 100.  DESCO’s listings include the Chrysler plant in Fenton, Northwest Plaza in St. Ann and the Merrill Lynch and Regions Bank buildings in Clayton.

DESCO was originally an acronym standing for Don and Ed Schnuck company.  It’s sister firm, the DESCO Group develops real estate, including projects for the Schnuck supermarket chain.

Today’s news was the second ownership switch in the local real estate business in the past week.  Last Tuesday, Brookfield Residential Property Services of Canada bought Prudential Real Estate and Relocation Services, franchisor for the Prudential Alliance real estate operation in St. Louis.

Andrea Lawrence, president of Prudential Alliance Realtors, said she expects little change in the St. Louis operation.  The realtors will continue to use the Prudential brand under the terms of the sale.

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Tim Boyd opened the Hidden Valley ski resort on a hilly patch of land 30 miles west of St. Louis 29 years ago. Two days after the first skiers took to the slopes on Dec. 17, 1982, warmer than usual temperatures caused the upstart ski area blanketed with man-made snow to close for eight straight days.

The setback was short-lived, however, and Hidden Valley attracted 30,000 visitors in the winter of 1982-82, drawing out a mix of curiosity seekers and avid skiers in its first season.

“We don’t want to go too far above our heads, but we feel certain that skiing in St. Louis will continue to grow,” Boyd told the Post-Dispatch at the time.

His words couldn’t have been more prescient. Boyd’s Peak Resorts, based in Wildwood, now owns or operates a dozen ski areas, more than any other company in the U.S.

Instead of a mere 30,000 people, the number of visitors at all of its properties totals nearly 1.8 million. Hidden Valley is slated to open this year on Saturday. Dec. 17. And soon, the company is hoping to launch an initial public offering that will allow the ski resort operator to keep growing.

Boyd, who declined to comment for this story, conceived of the idea of bringing skiing to St. Louis during a ski trip to Lake Tahoe in the 1970s. At the age of 25, Boyd and a group of investors, including family members, bought the property in west St. Louis County where Hidden Valley is located.

Eventually, Peak cobbled together a national footprint. The company owns the Snow Creek ski area near Kansas City and operates ski resorts in Indiana, Ohio, Pennsylvania, Vermont and New Hampshire.

“It was a slow start, and then all of a sudden, they put together a string of very profitable ski areas in the Midwest, and later, the East Coast,” said Michael Berry, president of the National Ski Areas Association in Lakewood, Colo.

Through acquisitions, Peak’s revenue jumped 305 percent from 2006 to its 2011 fiscal year, which ended April 30, reaching $98 million.

Berry attributes Peak’s growth to knowing key aspects of the business better than many competitors.

“They have experience in dealing with beginning skiers and making snow, and dealing with high volume day/night ski areas that are urban proximate,” he said.

Both alpine skiing and snowboarding have grown in popularity: there were 60.5 million visits to ski areas in the U.S. in the 2010-11 winter season, up from 57.3 million a decade prior, according to the National Ski Areas Association.

But it isn’t just about visitors. Overall, the ski industry also has done a better job recently on pricing season passes more competitively than in years’ past, and getting people to the property translates into increased opportunities for other sales, said Will Marks, a managing director and senior research analyst with JMP Securities in San Francisco. He covers Broomfield, Colo.-based Vail Resorts, which is publicly traded.

“Ski areas have figured out that if you can attract the skiers to the properties, that you can make additional sales on food and beverages, ski school and other services,” he said.

Still, the ski business is no sure investment. A big uncertainty for publicly traded ski companies is weather, said Ford Frick, managing director of BBC Research & Consulting in Denver.

“It makes it very difficult to have a predictable cash flow,” Frick said.

Analysts also are keeping a close eye on whether aging baby boomers will lead to a decline in the number of skiers in the U.S. over the next decade.

However, ski resorts such as Peak Resorts that cater to younger demographics by offering snowboarding, snow tubing and other offerings are well positioned, said Marks, who does not cover Peak.

“It looks like Peak is trying to capitalize on younger skiers and boarders,” he said.

Peak Resorts filed plans for an IPO with the Securities and Exchange Commission in April but delayed the offering due to market volatility. After putting the offering on hold for most of the year, in November Peak expanded its previously announced plans, raising the IPO from $40.3 million to $103.5 million.

Bloomberg reported last week that Peak’s IPO was imminent, but it was postponed on Thursday.

In its prospectus filed with the SEC, Peak said it planned to use a bulk of the proceeds from the offering for the repayment of debt, including $33.7 million for the Mount Snow ski area in Vermont and the Attitash Mountain Resort in New Hampshire, which Peak Resorts acquired in 2007 for $73.5 million.

Peak also plans to buy the land beneath two ski areas in northeastern Pennsylvania, Jack Frost and Big Boulder, that it currently leases.

The National Ski Areas Association’s Berry said he doesn’t think Peak Resorts’ growth spurt is over.

“I think there are other opportunities out there for them,” he said.

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Ford is recalling more than 128,000 Ford Fusion and Mercury Milan sedans from the 2010 and 2011 model years because the wheels can fall off the cars.

The recall affects only cars with 17-inch steel wheels built from April 1, 2009 through April 30, 2009, and from Dec. 1, 2009 through Nov. 13, 2010.

Federal regulators say that bolts holding the wheels on can fracture, causing a vibration. If the vibration is ignored, the wheels can separate from the car.

Ford says it’s not aware of any crashes or injuries caused by the problem.

Dealers will replace the lug nuts on all four wheels and check the rear disc brake surface. The recall is expected to begin around Jan. 24.

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WASHINGTON

Polish leaders unveiled a 2012 budget on Tuesday that lowers earlier predictions of economic growth _ an acknowledgment that Europe’s debt crisis is impacting the country.

The budget, which also aims to lower the country’s deficit, assumes 2.5 percent growth. A plan announced in September had assumed 4 percent growth and was criticized by some economists as overly optimistic.

Prime Minister Donald Tusk and Finance Minister Jacek Rostowski announced the budget at a news conference in Warsaw after the center-right Cabinet approved it. It foresees expenditures of nearly 329 billion zlotys ($99 billion) and revenue of 294 billion zloty ($88 billion). The deficit would be 35 billion zlotys ($10.5 billion; euro7.8 billion).

Tusk called it an “extremely responsible” budget lacking any radical features.

“A crisis isn’t a good time for revolution,” Tusk said. “A crisis is a time for responsible activity that will help people survive the crisis.”

Poland, the largest of the European Union’s eastern members, has shown remarkable resilience to the global financial turmoil. It was the only EU state to avoid recession during the downturn of 2008-2009, and its economy is on pace to grow 4 percent this year.

Even through September growth has been impressive.

Third quarter growth was 4.2 percent year-on-year, according to government data announced last week payday loan online. That was slightly slower than the 4.3 percent registered the previous quarter, but was still better than some economists had expected.

The economy has been buoyed by strong private consumption, a boom in investment by companies and a weakening of the currency _ the zloty _ which has made Polish exports cheaper in foreign markets.

However, economists warn that the country will eventually be impacted by the current crisis in the eurozone as its exports to neighbors are hurt, and because foreign investors are losing confidence in many emerging markets, including Poland’s.

As its struggles not to become another nation with a debt crisis, Warsaw is aiming to reduce its budget deficit to the EU’s limit of 3 percent of GDP. It was nearly 8 percent last year and is projected at nearly 5.6 percent this year.

To that end, Tusk announced a far-reaching set of austerity measures last month that include some tax increases and an eventual rise in the retirement age to 67 for men and women. Currently men can retire at 65 and women at 60.

The budget plan must still go to parliament, where it will likely be amended.

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Peru’s president has declared a 60-day state of emergency in a northern region torn by more than a week of protests against a highlands gold mine that is the country’s largest investment.

President Ollanta Humala said Sunday night that protest leaders had shown no interest in reaching agreement after a day of talks with Cabinet chief Salmon Lerner and three other ministers.

Lerner’s group was accompanied by Peru’s military and police chiefs while guarded by hundreds of heavily armed police online payday loans.

Local elected officials in the state of Cajamarca oppose the $4.8-billion Conga gold and copper mining project, in which U.S.-based Newmont Mining Corp. is a majority owner.

Project opponents have said they fear it will taint and diminish their water supply.

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Kellwood Co. is planning to drop Adam, the upscale contemporary sportswear line that it acquired last year, according to a news report.

Women’s Wear Daily reported today that the Town and Country-based apparel company has decided to no longer fund Adam and is exploring various options, including selling the business. Adam employees were told of the decision earlier today, according to the report.

Kellwood acquired Adam, the brainchild of designer Adam Lippes, in August 2010. It was one of the company’s first major acquisitions as it embarked upon a brand-buying spree. Lippes stayed on with the brand to oversee it. Terms of the deal were not disclosed at the time.

“Adam is the first one we’ve nailed, ” Michael Kramer, Kellwood’s chief executive at the time, told the Post-Dispatch. “Hopefully this is the first of many to come.”

Kellwood followed that acquisition with others such as Rebecca Taylor and Scotch & Soda. It has also launched some new in-house brands such as Lamb & Flag.

It’s not immediately clear what dropping Adam might mean about Kellwood’s recent focus on buying more luxury, designer brands. But Kramer, who was spearheading that strategy, has recently left Kellwood to become chief operating officer at J.C. Penney.

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Two separate attacks killed 17 people on Thursday in a northeastern Iraqi province that was once an al-Qaida stronghold, Iraqi officials said.

The marketplace car bombing and the assault on the home of an anti-al-Qaida militia leader came on the third day of a visit by U.S. Vice President Joe Biden, in advance of the withdrawal of American troops at the end of the year.

A parked car bomb exploded in the town of Khalis as morning shoppers were starting to arrive, killing 10 persons and wounding 22 others, two police officials said.

The officials spoke on condition of anonymity because they were not authorized to talk to the media.

Khalis, a Shiite enclave 50 miles (80 kilometers) north of Baghdad, is surrounded by the largely Sunni province of Diyala. The province was a hotbed of al-Qaida in Iraq during the height of the country’s violence in 2004-2007.

Also in Diyala, gunmen stormed the home of an anti-al-Qaida Sunni fighter at dawn and killed seven people, police said. The victims of the attack in the town of Buhriz about 35 miles (60 kilometers) north of Baghdad included the local leader of the pro-government Sahwa or Awakening Councils movement and six members of his family, four of whom were women.

Faris al-Azawi, the spokesman of Diyala’s health directorate, confirmed the death tolls in both Khalis and Buhriz.

The attacks came as Biden met with Iraqi officials on a trip designed to chart a new relationship between the two countries ahead of the withdrawal of U.S. forces by the end of this year.

Iraqi security officials maintain that they are fully prepared for the American withdrawal, which is required under a 2008 security pact between the U.S. and Iraq. About 13,000 U.S. troops are still in the country, down from a one-time high of about 170,000. All of those troops will be out of the country by the end of December.

But many Iraqis are concerned that insurgents may use the transition period to launch more attacks in a bid to regain their former prominence and destabilize the country.

At least 56 Iraqis have been killed in separate attacks across the country in the past eight days, a warning that even more violence may be in the offing ahead of the American withdrawal.

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BRUSSELS