Rhode Island: Rhode Island Real Estate Auction

Kansas City area labor leaders met this morning at the downtown Marriott and committed to get-out-the-vote efforts leading up to the Tuesday elections.

Each local is committing at least 10 volunteers to go door-to-door, make calls or hand out campaign fliers. The unions support the minimum wage increase on the Missouri ballot and as well as selected candidates.

Herb Johnson, secretary-treasurer of the Missouri AFL-CIO , noted that organized labor has endorsed some Republican candidates this year in addition to the traditional Democratic slate.

Labor’s efforts leading up to the November elections this year have concentrated on getting union members to the polls, particularly those who have not been regular voters in past non-presidential elections.

Johnson said the push by organized labor could affect 1 in 4 votes in this election. He said the state AFL-CIO organization is estimating that between eight and 11 Missouri House seats and possibly three seats in the Missouri Senate could be claimed by pro-labor candidates.

The national AFL-CIO has poured nearly $90,000 into the campaign to increase the minimum wage in Missouri, Johnson said.

He said polls indicate about 64 percent of Missourians favor the increase, which would raise the wage floor in the state from $5.15 an hour to $6.50 an hour, with further increases indexed to the rate of inflation.

To reach Diane Stafford, call (816) 234-4359 or send-email to .

Garmin Ltd. has won a court battle with competitor TomTom filed over the design of its portable navigation devices.

In a release this morning, Garmin said the District Court in The Hague, the Netherlands, had refused TomTom’s request for a preliminary injunction blocking the company from selling six navigation devices.

“The judge has rejected the claim and has ordered TomTom to pay the court costs,” the court said in its ruling.

TomTom filed the injunction claiming Garmin infringed on patents covering the design of the TomTom Go navigator.

The TomTom legal action followed lawsuits filed by Garmin contending the Dutch company had infringed on a number of Garmin software patents. That lawsuit is continuing.

The Garmin lawsuit is scheduled to go to trial in U.S. District Court in Wisconsin in February.

Olathe-based Garmin also has filed lawsuits against TomTom in the Netherlands and the United Kingdom.

“We are pleased with the Dutch court’s recognition that TomTom’s infringement allegations lack merit,” said Andrew Etkind, Garmin’s general counsel. “This baseless lawsuit was filed by TomTom after Garmin took legal action against TomTom in the United States to stop TomTom’s pervasive infringement of Garmin’s intellectual property rights.”

TomTom and Garmin control the lion’s share of the consumer navigation market. TomTom controls more than half of the European market, while Garmin controls about 60 percent of the U.S. market.

The lawsuits follow Garmin’s expansion into Europe and TomTom’s expansion into the U.S.

On Wednesday, Garmin reported sales for the third quarter of $408 million. The record sales were below the expectations of Wall Street, however, and investors sent shares down more than 156 percent in heavy trading.

After falling sharply Wednesday, Garmin shares were up $1.14, or 2.53 percent, at $46.12 in heavy midday trading.

To reach David Hayes, call (816) 234-4904 or send e-mail to .

Interstate Bakeries Corp., the bankrupt maker of Twinkies and Wonder bread, today said it has agreed to settle a long-standing federal investigation into its record-keeping and accounting practices.

The company also said it has been ordered by the Securities and Exchange Commission’s Division of Enforcement to file a year and a half of delinquent quarterly and annual reports by Dec. 31 or its stock, already trading on the speculative over-the-counter market, could be delisted.

Kansas City-based Interstate Bakeries released restated annual and quarterly reports for 2004 and 2005 last month but still hasn’t released reports for the year ending last May or reports for the current year.

“Although IBC is working toward the completion of the required reports prior to the deadline, there can be no assurance that IBC will be able to complete all such filings prior to the deadline,” the company said in a release.

Interstate Bakeries shares were down 50 cents, or 17.54 percent, to a 52-week low of $2.35. The stock had traded in a 52-week range of $2.40 to $9.95.

The proposed settlement is tied to a private investigation the SEC began after the company’s audit committee in 2004 said it was looking into how the company set aside money for future workers’ compensation claims and other reserves.

Under the proposal, which still must be approved by the SEC, Interstate Bakeries would agree to a cease-and-desist order against future violations of record-keeping and internal controls. The company is not admitting or denying the allegations and would not pay any fines.

Aquila Inc. said third-quarter profits rose dramatically as the company realized gains on selling three of its gas utilities.

For the three months ending Sept. 30, the Kansas City-based company reported earnings of $115.7 million, or 31 cents a share, compared with a loss of $75.7 million, or 20 cents, a year ago.

Measuring just those operations the company has not yet sold, the company said it lost $20.6 million, or 5 cents a share, compared with a loss of $80 million, or 21 cents, a year ago.

Analysts surveyed by Thomson Financial had expected earnings of 4 cents a share.

Revenue for the quarter increased 5 percent to $316.6 million, well short of analysts’ prediction of $364.1 million.

Aquila said it recorded one-time gains during the quarter of $71.5 million on the sale of its Minnesota natural gas business and an income tax benefit of $56 million from applying capital gains on the sale of its gas businesses in Missouri and Michigan.

It also noted the loss in third quarter of 2005 was due mainly to an $82.3 million charge for converting certain securities early.

The company has been selling off many of its utilities and all of its unregulated businesses to bring down debt and reinvest in the remaining utilities. Chief Executive Officer Richard Green said in a news release that the company has reduced its debt by almost 30 percent.

Aquila shares, which have traded in a 52-week range of $3.29 to $4.77, were down 6 cents, or 1.30 percent, to $4.54 in midday trading on the New York Stock Exchange .

Premium Standard Farms Inc. today said legal costs and expenses related to its merger with Smithfield Foods Inc. cut into net income in its second quarter.

For the period ended Sept. 23, net income dropped to $4.3 million, or 13 cents a share, from $12.2 million, or 39 cents a share, a year ago.

The Kansas City-based provider of pork products, said it took a 17 cent a share charge related to merger costs and legal settlements in the quarter.

In September, Smithfield said it plans to buy its rival for $674 million in cash and stock and assume $117 million in debt.

Analysts polled by Thomson First Call had been expecting the company to post earnings of 20 cents a share.

Premium Standard said its results were favorably impacted by rising lean hog prices.

Revenue in the quarter grew to $220.4 million from $213.2 million.

In midday trading on the Nasdaq, Premium Standard shares were down 5 cents at $18.95. Shares have traded in a 52-week range of $13.25 to $20.64.

QC Holdings Inc. , an Overland Park pay day loan company, said increased sales and reduced loan losses helped produce a profit in its third quarter.

For the three months ended Sept. 30, QC Holdings reported net income of $2.5 million, or 12 cents a share, versus a net loss of $976,000, or 5 cents, a year ago. Revenue grew to $45.3 million from $41.4 million a year ago.

Earnings per share beat Wall Street estimates by 3 cents. In morning trading on the Nasdaq, QC Holdings shares were up 52 cents, or 3.88 percent, at $13.91. Shares have traded in a 52-week range of $11.10 to $15.60.

“Third quarter results were a positive step for the company,” QC Chairman and Chief Executive Officer Don Early said in a news release. “Our comparable branches produced strong net revenue increases during the quarter, indicative of better revenues and continued success in controlling loan losses.”

Entertainment Properties Trust late Wednesday reported a boost of 16 percent in revenue in its third quarter and an increase in net income of 17 percent.

In the three months ended Sept. 30, net income available to common shareholders rose to $17.5 million, or 65 cents a share, from $14.9 million, or 58 cents, in the same period a year ago. Revenue grew to $48.3 million from $41.8 million.

Entertainment Properties Trust is a real estate investment trust and is the largest owner of entertainment real estate in North America.

In midday trading on the New York Stock Exchange , Entertainment Properties shares were up 8 cents at $54.46. Shares reached a 52-week high of $55.75 on Tuesday.

Members of the Financial Planning Association of Greater Kansas City have volunteered to provide free advice to KansasCity.com users who have personal finance questions. Ask your questions about issues like retirement planning, investing or finding money for higher education. Answers will typically be posted within 48 hours. The is for educational purposes only and participants should be aware that a financial planning engagement has not been established.

Ford Motor Co., which last week announced a $5.8 billion third-quarter loss, is reportedly cutting back health care benefits for some white-collar retirees, boosting health care premiums for salaried workers and won’t give them merit pay raises next year.

The benefit cuts were detailed Wednesday in an information packet, a copy of which was obtained by The Detroit News. Details of the cuts also were reported by the Detroit Free Press , citing Ford spokesman Oscar Suris.

Ford said that starting in 2008, it no longer will provide health insurance for Medicare-eligible salaried retirees. In its place, Ford said it will give them $1,800 a year for supplemental insurance or out-of-pocket health costs.

Ford said it also will stop providing health coverage for dependent children of retirees who are 65 or older. The company now covers some employees’ and retirees’ children up to age 25.

Ford also said it was raising health care premiums effective June 1 for most salaried workers by about 30 percent for the second straight year.

The Dearborn, Mich.-based automaker spent $3.5 billion last year for health benefits for 590,000 employees, retirees and dependents. Two-thirds of the cost was for retiree health care.

In addition to the health care cuts, Ford’s white-collar workers will not get merit pay raises next year for the first time in 13 years, the company said.

Ford did say that it would begin a partial match to salaried employees’ 401(k) retirement contributions next year. It had suspended such matching contributions in July 2005.

With bids for the mammoth Tribune Co. coming in far lower than expected, the media giant is telling prospective bidders that individual pieces are now available for sale, according to published reports.

Tribune Co. representatives made a series of calls Wednesday signaling their new intention to those who have expressed interest in the company’s individual holdings, according to unidentified sources cited today in the Chicago Tribune , the Los Angeles Times, The Wall Street Journal and The New York Times .

The company put itself on the auction block in late September, and statements by Chief Executive Dennis FitzSimons at the time made clear that officials would prefer to sell the entire company but would keep their options open.

“In order to maximize shareholder value, our initial focus is determining the best strategic alternatives for the company and its publishing and broadcast groups as a whole, before evaluating strategic alternatives for individual business units,” FitzSimons said in a statement in September.

Quoting people involved in the company’s sale, media outlets said the bids offered up so far have been lackluster. The Tribune Co. owns the Chicago Tribune , the Los Angeles Times , the Chicago Cubs, WGN-TV and several other media outlets nationwide.

Three investor groups have submitted preliminary, nonbinding bids for Tribune Co., the Tribune reported, citing sources.

One group consists of Fort Worth-based Texas Pacific Group and Boston-based Thomas H. Lee Partners . The other bids came from Boston-based Bain Capital and an alliance made up of Chicago’s Madison Dearborn Partners , New York-based Apollo Management and Rhode Island-based Providence Equity Partners .

■ Royal Ahold NV , the operator of grocery chains Stop & Shop, Giant and Albert Heijn, said third-quarter sales rose to 10.3 billion euros ($13.1 billion) from 10.25 billion euros a year earlier.

■ Barrick Gold Corp., the world’s largest gold producer, said third-quarter profit nearly to $40 million or 46 cents a share, from $113 million, or 21 cents, a year ago. Barrick also said it had reached a preliminary agreement with Highland Gold to transfer companies holding Russian and Kyrgyz licenses in return for more Highland shares.

■ Blockbuster Inc. reported a narrower loss of $24.7 million, or 15 cents a share, from a loss of $491.4 million, or $2.67, last year. The movie and video rental chain said revenue fell to $1.33 billion from $1.37 billion.

■ BMW AG said third-quarter profit slipped to 452 million euros ($577 million) from 455 million euros a year earlier. The luxury automaker said sales fell to 11.56 billion euros ($14.75 billion) from 11.72 billion euros.

■ CBS Corp.’s third-quarter net income fell sharply from a year ago when it was still combined with Viacom Inc. CBS earned $316.9 million or 41 cents a share, versus $708.5 million, or 90 cents, a year ago when it was still reporting as a combined company. Revenue edged higher to $3.38 billion from $3.37 billion.

■ International Paper Co. said third-quarter earnings plunged to $201 million, or 42 cents a share, from $1 billion, or $2.03, last year. Net sales eased to $5.88 billion from $5.93 billion last year.

■ MGM Mirage Inc., the world’s second-largest casino company, said third-quarter profit climbed to $156.3 million, or 54 cents a share, from $93.2 million, or 31 cents, a year ago. Revenue rose to $1.90 billion from $1.81 billion last year.

■ Sempra Energy , parent of electric and gas utilities and an energy trading business, said third-quarter profit jumped $653 million, or $2.49 a share, from $221 million, or 86 cents, a year ago. Revenue fell by $2.71 billion to $2.69 billion.

Russia’s state-controlled natural gas monopoly said it would more than double the price of gas for Georgia, raising the economic pressure on Moscow’s small southern neighbor amid spiraling tensions between the two countries.

Georgian Foreign Minister Gela Bezhuashvili said he had received assurances that Russia would not cut off the gas as it did with Ukraine earlier this year, during a particularly harsh winter. That stoppage, amid fierce negotiations over the new, higher price demanded by OAO Gazprom , briefly interrupted deliveries to Europe and sent shock waves through countries already wary of overdependence on Russian energy supplies.

Gazprom, which has been criticized as a tool of Kremlin policy, said in a one-line statement that it plans to charge Tbilisi $230 per 1,000 cubic meters of gas, compared with the $110 that it charges now.

The gas giant has consistently argued the increases are a long-overdue transition to market pricing. However, they have been widely seen in the West as part of the Kremlin’s attempts to put pressure on former Soviet republics striving to throw off Russian influence.

Germany’s unemployment rate dropped below 10 percent last month for the first time in four years, government figures showed today, underlining the recovery of Europe’s biggest economy after years of stagnation.

The unadjusted jobless rate fell to 9.8 percent in October from 10.1 percent the previous month. The number of Germans registered as unemployed sank by 153,000 to 4.085 million.

The jobless rate was last below 10 percent in November 2002, when it weighed in at 9.7 percent.

Federal Labor Agency chief Frank-Juergen Weise attributed the improvement to a traditional autumn upswing, but also said the drop in the number of jobless Germans was more than double the average for October over the past three years.

In seasonally adjusted terms, the jobless rate fell to 10.4 percent in October from 10.6 percent in September.

Italy’s Luxottica Group , which makes and sells eyeglasses, said it will pay about $90 million to acquire about 100 optical stores in the United States.

The deal to acquire D.O.C Optics , a retail business whose stores are mainly located in the Midwest, represents a further expansion of Luxottica’s operations in North America.

Leonardo Del Vecchio, chairman of Luxottica Group, said in a statement: “The D.O.C Optics transaction represents another key step in our long-stated strategy to maximize growth opportunities for our optical retail brands, including LensCrafters and Pearle Vision.”

Luxottica Group said the deal is expected to be completed in the first quarter of next year.

D.O.C Optics stores operate in Missouri, Michigan, Ohio, Wisconsin and Illinois as well as in Florida with a majority of its retail locations in and around the Detroit area.

A disappointing sales performance and outlook from Wal-Mart Stores Inc. raised the possibility of price wars this holiday season — a boon to consumers but a troubling prospect for the entire retail industry.

“The news from Wal-Mart is definitely discouraging,” said Ken Perkins, president of RetailMetrics LLC , a research company in Swampscott, Mass. “They are going to be very price aggressive. And it is going to have an effect on everyone. It is going to force other retailers to cut their prices, which in turn will squeeze their profit margins.”

The world’s largest retailer, whose sales were dragged down by a failed women’s fashion strategy that went too trendy and by disruptions from a store remodeling program, said Thursday it will be using price as a weapon in such areas as toys and electronics to drive holiday sales.

The latest development from Wal-Mart came as the nation’s retailers reported mixed October sales, the result of consumers taking a breather after going on a buying spree in September.

Other retailers reporting lackluster results included BJ’s Wholesale Club Inc. and Pacific Sunwear of California Inc. Meanwhile, department stores scored again, with robust results from such companies as Federated Department Stores, J.C. Penney Co. Inc. and Saks Inc. Payless ShoeSource Inc. of Topeka and Duckwall-Alco Stores Inc. of Abilene also reported gains.

The International Council of Shopping Centers-UBS sales tally rose 3 percent in October, less than the 4 percent gain in September. The tally is based on same-store sales, or sales opened at stores opened at least a year. Same-store sales are considered the best indicator of a retailer’s health.

Still, Perkins believes shoppers will regain their stride during the holiday shopping season. Consumers have been resilient even when energy prices soared earlier in the year. The decline in gas prices that began in late summer has helped ease the financial pain consumers have felt.

But consumers’ willingness to spend depends largely on their own job security. While the job market has been steady, recent monthly reports from the Labor Department have showed slower growth. And consumers’ confidence, while still high, weakened in October, dragged down by their concerns about the job market, according to the Conference Board.

The latest report on jobless claims released today raised concerns about whether the slowing economy is finally pushing companies to lay off workers. The Labor Department said the number of newly laid off workers filing claims for unemployment benefits unexpectedly surged last week to the highest level in more than three months.

Wal-Mart, which should have benefited from falling gasoline prices, reported a meager 0.5 percent gain in October same-store sales; it was hurt by its namesake division, which eked out a 0.3 percent gain. Sam’s Club had a 2.0 percent same-store sales gain. A big problem at Wal-Mart was that it overstocked stores with too many trendy items like skinny jeans, officials told Wall Street analysts.

Wal-Mart estimated that same-stores sales should be unchanged in November from a year ago.

“As in September, apparel sales, particularly in women’s apparel, were softer than expected,” said Tom Schoewe, executive vice president and chief financial officer at Wal-Mart in a statement.

But he noted the company’s aggressive advertising of its discounts, or what it calls rollbacks, should help “reinforce Wal-Mart’s price leadership position.”

Schoewe added that the company is already seeing a “significant lift in unit volume” from its move in mid-October to discount more than 100 holiday toys. “In electronics, another dynamic category for the holiday season, we have several initiatives planned to drive holiday sales,” he said.

Meanwhile, rival Target had a solid 3.9 percent gain in same-store sales, though the figure was slightly below the 4.2 percent estimate from Wall Street.

BJ’s had a 0.7 percent decline in same-store sales, below the 0.9 percent forecast. The company said falling gasoline prices dampened sales at the retailer, which sells gasoline.

Department stores, which have benefited from consolidation and an improved fashion offerings over the last several months, recorded robust gains again.

Federated which acquired May Department Stores Co. last year, posted a hefty 7.7 percent gain in same-store sales, beating the 6.2 percent estimate from Wall Street. Same-store sales include only Macy’s and Bloomingdale’s.

Federated said it expects same-store sales to increase by 3 percent to 5 percent in November as well as in the fourth quarter as a whole.

Penney had a same-store sales increase of 8.1 percent, beating the 6.2 percent estimate.

Teen retailers had a mixed performance.

Pacific Sunwear posted a 7.1 percent drop in same-store sales, worse than the 5.4 percent decline Wall Street expected. On Wednesday, American Eagle Outfitters Inc. reported a same-store sales increase of 8 percent, a bit below the 9.9 percent estimate. The teen retailer said that the holiday collection, which arrived in the last week of the month, has met with positive consumer response.

Discount retailer Duckwall-Alco Stores Inc. said its October same-store sales, or sales at stores open at least a year, rose 3.9 percent.

Total sales for the four-week period ended Oct. 29 increased 6.5 percent to $34.2 million from $32.1 million a year ago.

Same-store sales in the third quarter grew 5.9 percent, while total sales over the 13 weeks gained 9.3 percent to $110.1 million from $100.7 million during the same period a year ago.

Year-to-date, same-store sales advanced 6.6 percent and total sales rose 10.6 percent to $339.1 million from $306.6 million a year ago.

Family footwear retailer Payless ShoeSource Inc. said its third-quarter same-store sales, or sales at stores open at least a year, rose 5.2 percent on strength in women’s and children’s categories.

Same-store sales are a closely watched performance gauge in the retail industry.

Total sales for the quarter ended Oct. 28 increased 5.5 percent to $703.4 million from $665.5 million during the same period last year. Year-to-date same-store sales gained 2.6 percent, while total sales over the period advanced 2.4 percent to $2.1 billion from $2.05 billion a year ago.

Payless ShoeSource said October would mark the final month for quarterly sales results, including same-store sales. The company plans to include sales results in its quarterly financial reports beginning in the next quarter.

■ About 275,000 toy keys, imported by RC2 Brands Inc., because the keys can crack into small parts, which can be a choking hazard for children. The company has received four reports of cracked keys. No injuries have been reported.

The recalled keys are marketed under RC2’s Learning Curve and The First Years brands. The recall includes John Deere “Real Keys” and The First Years brand “Shake ’n Jingle Keys,” “Shake & Jingle Keys” and “My Jingle Keys.” Each product has three toy keys attached to a blue, red or green remote control that has various colored buttons. The buttons activate sounds. Only toys with the letter “F” in the date code stamp listed between date codes 2015F01 through 2636F04 on the packaging and product are being recalled. The date code is on the back of the remote control.

Departments stores and independent stores nationwide sold the product from August 2005 through October 2006. For a free replacement toy, contact RC2 at 1-800-704-8697 or visit Learning Curve’s Web site . For more information, visit .

■ About 237,000 flashing pacifiers, imported and sold by a number of different companies, because the nipple could separate from the shield and cause a child to choke. Some of the pacifiers were sold with necklaces that could strangle a child. One of these necklaces has beads that could come lose and be inhaled.

The pacifiers come in a variety of colors and have flashing lights. They were imported and sold by the following companies: Rhode Island Novelty, Hayes Specialties Corp., My Bargain Bin LLC., Ravesupply.com, Vistawholesale.com, Xtreme Jewelry, Intertradecorp.com, Litesrus.com and Dollar Days International LLC.

The pacifiers were sold using the following names: Flashing Joke Novelty Pacifier, “Hot” Flashing Pacifier, 2 in 1 Flashing Pacifier with Whistle, Pacifier Necklace, Flashing Pacifier “I am baby, I need to be loved,” 2 in 1 Flashing Pacifier with Whistle Necklace and Practical Joke “Hot” Flashing Pacifier.

The pacifiers were sold online and at novelty and toy stores, and carnivals and amusement parks around the country between January 2003 and September 2006. For a refund, return the pacifiers to the retailer. For more information call the CPSC recall hot line at 1-800-638-2772 or visit .

The productivity of American workers slowed to a standstill in the summer, while wages were rising at the fastest clip in more than two decades — a combination likely to raise inflation concerns at the Federal Reserve .

The Labor Department reported that productivity, the amount of output per hour of work, showed no change in the July-September quarter, while labor costs rose by 3.8 percent. For the past year, wages and other labor costs are up by 5.3 percent, the fastest increase since 1982.

While rising wages and benefits are good news for workers, they raise concerns about inflation especially at a time when productivity is slowing. If companies decide to pass on their higher payroll costs by boosting the price of their products, that could translate into increased inflation.

In other economic news, orders to factories for manufactured products rose by 2.1 percent in September, the biggest increase in six months, but virtually all of the strength came in a surge in orders for commercial aircraft. The Commerce Department said that orders for long-lasting durable goods were up 8.3 percent, offsetting a 4.6 percent drop in demand for food, gasoline and other nondurable products.

The increase in durable goods, which was revised up from an initial estimate last week of a 7.8 percent gain, reflecting a huge 189.7 percent surge in demand for commercial aircraft. Excluding airplanes and other transportation products, factory orders would have fallen by 2.4 percent. The drop in nondurable goods was attributed in part to lower prices for petroleum products.

In a third report, the number of newly laid off workers filing claims for unemployment benefits unexpectedly shot up last week to the highest level in more than three months. A total of 327,000 fired employees filed benefit claims, up by 18,000 from the previous week.

The Labor Department said that the total number of jobless claims, which are adjusted for normal seasonal variations, was the highest since early July, raising concerns about whether the slowing economy is finally beginning to push companies to lay off workers.

The flat productivity reading in the third quarter was the poorest showing since a 0.1 percent decline in productivity in the final three months of last year. Over the past four quarters, productivity has risen by 1.3 percent, the weakest showing since a 1.1 percent rise in early 1997.

The 3.8 percent rise in the cost of labor per unit of output followed even bigger gains of 9 percent in the first quarter and 5.4 percent in the second quarter. Those increases pushed labor costs up by 5.3 percent for the year ending in September, the biggest gain since late 1982.

The Federal Reserve raised interest rates 17 consecutive times in an effort to slow the economy enough to bring inflation pressures under control. The Fed has left rates unchanged for three straight meetings, hoping that it has done enough to slow economic growth.

However, the significant slowing in productivity growth and the continued rise in wage pressures, if not reversed in coming quarters, could prompt the Fed to resume raising interest rates to fight inflation.

Since 1995, the country has enjoyed a decade of strong gains in productivity, which is the primary ingredient needed to lift living standards. Increased output means that companies can pay their workers more without having to raise the cost of their products — increases that push inflation higher.

The concern is that with productivity gains slowing over the past year and the cost of labor rising, these trends could make the Fed’s job of keeping inflation under control more difficult.

The rise of 18,000 in the level of jobless claims was far above the 2,000 increase that analysts had been expecting. So far, the slowing economy has prompted companies to trim their plans to hire new workers, but they have resisted laying off current employees. However, the severity of the slowdown could be prompting them to start laying off existing workers.

The government will report on the October jobs picture on Friday. The expectation is that unemployment will remain at a low of 4.6 percent and hiring will rebound to 125,000 new jobs, up significantly from the anemic 51,000 new jobs created in September.

The European Central Bank held its key interest rate steady at 3.25 percent as expected today but set the stage for an increase — likely a quarter of a percentage point — next month.

With business and consumer confidence in Germany and France soaring and investment booming worldwide, the ECB is concerned that inflation must be contained to keep markets running smoothly.

ECB President Jean-Claude Trichet said that “strong vigilance remains of the essence,” a signal that the bank is set for an increase when it meets Dec. 7. He has previously used the phrase at meetings before a rate increase was announced the next month.

Stocks fluctuated today after the Labor Department said productivity was flat in the third quarter while wages rose nearly 4 percent, touching off concerns that the Federal Reserve will continue to wrestle with inflation.

Adding to investor concern were mixed reports from retailers on October sales, including Wal-Mart Stores Inc. , which had disappointing results last month and warned that November sales would also come in below expectations.

The economic reports, which showed wage pressure was increasing at the fastest rate in more than 20 years, rattled investors who have sent the Dow Jones industrial average to a four-day losing streak amid concerns that the economy might be slowing too quickly. Wall Street wants a gradual slowdown so the Fed will cut interest rates.

T.J. Marta, economic strategist at RBC Capital Markets , sees the rising labor costs for the third quarter and an upward revision for the second quarter as unnerving to many investors but said the Fed is looking for such a slowdown. “The Fed is trying to engineer a slowdown so this is all good. The plane is coming in for a landing.”

In midday trading, the Dow, which earlier fell below the 12,000 benchmark, was down 24.49, or 0.20 percent, at 12,006.53. The Standard & Poor’s 500 index was down 2.63, or 0.19 percent, at 1,365.18, and the Nasdaq composite index was down 1.97, or 0.08 percent, at 2,332.38.

Light, sweet crude was down 46 cents at $58.25 a barrel on the New York Mercantile Exchange . Oil prices, whose decline had given a boost to stocks during their three-month rally, extended their decline in recent days but largely failed to prop up investor sentiment in the face of economic news. Doubts remain about whether OPEC will push through production cuts, pushing down the price of oil.

Meanwhile, the Labor Department said the number of newly laid off workers seeking unemployment benefits rose last week to its highest level in more than three months.

Investors appeared unfazed by a Commerce Department report that showed factory orders rose a lower-than-expected 2.1 percent in September.

Marta contends the productivity figure is typical with what would be seen late in an economic growth cycle, when employers had as many workers as needed. The Fed has said it remains concerned about inflation and that it wants to see a further slowing. He sees investors as split into two camps: those who see a soft landing occurring and those who believe the economy will fall into recession. While he expects a gradual slowdown, he believes investors will at times become agitated when they receive signs of slowing, even those they had been anticipating.

Among retailers, Wal-Mart fell 69 cents to $48.16 after reporting that it expects same-store sales, or sales at stores open at least a year, will be flat in November.

Wal-Mart’s disappointing news raised questions about whether the experiences of the world’s largest retailer indicated trouble ahead. With the holiday season approaching, Wall Street is hoping robust consumer spending will serve as a counterpoint to weak economic readings — from gross domestic product to consumer spending — that have been seen in recent days. However, Wall Street had bet that gas prices, which were sharply from their year highs in July, would leave consumers eager to spend the extra money in their wallets. October sales results didn’t seem to bear that out, particularly for discounters.

BJ’s Wholesale Club Inc. fell 29 cents to $28.29 after issuing a disappointing sales report, while specialty retailer Limited Brands Inc. rose 45 cents to $29.26 after posting stronger-than-expected results for October.

In other corporate news, Nomura Holdings Inc. agreed to acquire Instinet, the electronic stock broker, from private-equity firm Silver Lake Partners . Nomura, Japan’s biggest brokerage, fell 20 cents to $17.18.

■ For the quickest, most complete local afternoon report on the financial and commodities markets, check out The Closing Bell report on .

■ Tomorrow in Business: Kansas City Power & Light Co. parent company Great Plains Energy reports financial results after markets close.

■ Sunday in MoneyWise: Douglass National Bank , the area’s only black-owned bank, is seeking capital to cover its loan problems. It’s a struggle faced by many of the nation’s minority owned banks.