Strong start for Oscar telecast in ratings

NEW YORK — Ratings for the Academy Awards telecast in the nation's biggest television markets are up 7 percent over last year.

The Nielsen company said Monday that New York, Kansas City, Mo., and Chicago were the strongest markets for Sunday's telecast, where "12 Years a Slave" won the Academy Award for best picture.

Nielsen's estimate for how many people actually watched the show was expected later Monday. The Oscars are frequently the second most-watched television program of the year after the Super Bowl, with viewership topping 40 million people last year.

Overnight ratings in the nation's 56 biggest markets are only a partial picture, however, and sometimes not reflective of the country as a whole.

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Ford's US sales down 6 pct in February

DETROIT — Ford's U.S. sales dropped 6 percent in February as winter weather kept many buyers at home.

Ford's car sales dropped 14 percent and utility sales were down 4 percent.

Pickup truck sales remained a bright spot. Ford's F-Series sales were up nearly 3 percent to 55,882. It was the best February for the F-Series in eight years.

Ford's luxury Lincoln brand also saw improvement. Sales of the MKZ sedan, which went on sale last spring, more than tripled to 3,044.

Ford said its sales to rental, business and other fleets dropped 10 percent because the weather delayed some deliveries. The company expects to make up those sales in March.

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Airlines cancel nearly 2,300 flights

NEW YORK — Airlines canceled nearly 2,300 flights Monday as the latest winter storm hit the U.S. East Coast.

The hardest hit cities were Washington D.C., Philadelphia, New York and Baltimore. All flights into and out of Ronald Reagan Washington National Airport have been halted.

On Sunday, airlines scrapped nearly 2,000 flights in Dallas, Chicago and Houston, according to flight tracking site FlightAware.com. There are more than 30,000 flights in the United States on a typical day.

It's been a daunting winter for air travelers. Airlines have canceled more than 87,000 domestic flights since Dec. 1, a record number.

Carriers are now much more likely to cancel flights at the first sign of bad weather. For instance, more than 550 flights to and from New York were canceled Monday, even though the city only got a light dusting of snow. Original forecasts had called for much higher snow totals.

Passengers on New York-based JetBlue were among the hardest hit, with the airline scrapping 23 percent of its flights, according to FlightAware. The overwhelming majority of JetBlue flights leave from Boston, New York or Washington D.C. making the airline especially prone to cancellations when a storm hits the Northeast. US Airways and the regional airlines it contracts with along the East Coast also had a high percent of cancellations.

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Men's Wearhouse, Jos. Bank signal they're talking

NEW YORK — Men's Wearhouse and Jos. A. Bank Clothiers Inc. are moving a bit closer to a possible combination, announcing they are exchanging certain confidential information with each other.

Men's Wearhouse Inc. said Monday that it's also received a draft merger agreement from Jos. A. Bank.

The news comes four days after Jos. A. Bank, based in Hampstead, Md., rejected the latest acquisition bid of $1.78 billion from Men's Wearhouse. The offer of $63.50 per share was increased from Men's Wearhouse's prior bid of $57.50 per share. The Houston company has said it may raise the bid to $65 per share, if some conditions are met.

While Jos. A. Bank nixed the $63.50 per share offer, it did say on Thursday that it was willing to meet with Men's Wearhouse to discuss the higher bid.

Men's Wearhouse's $63.50 per share offer is set to expire on March 12, unless extended.

The back-and-forth between Men's Wearhouse and Jos. A. Bank started in October, when Jos. A. Bank offered to buy its larger rival for $2.3 billion. Men's Wearhouse scoffed at that offer, and turned the tables, offering to buy its rival for $1.54 billion. But after Jos. A Bank turned down that overture, Men's Wearhouse increased its bid to $1.6 billion, and then again to $1.78 billion.

Shares of Jos. A. Bank rose 17 cents to $62.25 in morning trading. Men's Wearhouse's stock fell 55 cents to $53.24.

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GM blames weather as Feb. sales drop 1 percent

DETROIT — General Motors' U.S. sales fell 1 percent last month as winter storms pounded much of the nation.

The country's largest automaker conceded that the weather had an impact but said sales started to thaw toward the end of the month.

GM says it sold just over 222,000 cars and trucks, led by the Chevrolet Cruze compact car, with sales up almost 22 percent.

But sales of the Chevy Silverado pickup, GM's top-selling vehicle, fell 12 percent for the month.

Industry analysts expect auto sales overall to rise slightly for the month as most companies report declines or modest increases. Nissan and Chrysler bucked the trend and reported double-digit increases.

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Energy costs boosted US consumer spending in Jan.

WASHINGTON — Americans spent more in January, but the increase came from a surge in spending on heating bills during the harsh winter. Spending in areas such as autos and clothing declined.

Spending rose 0.4 percent in January after a 0.1 percent gain in December the Commerce Department said Monday. The December figure was revised down from a 0.4 percent increase.

Income grew 0.3 percent in January after no increase in December.

The overall spending increase in January reflected a 0.8 percent jump in spending on services, the effect of higher heating bills. It was the biggest increase in spending on services since October 2001.

Spending on durable goods such as autos fell 0.3 percent. And spending on nondurable goods, covering things like clothing and food, dropped 0.7 percent.

"Spending looks great but is not," said Ian Shepherdson, who noted the jump in temporary weather-related energy demand. Without an 11.3 percent jump in spending on utility bills, Shepherdson said consumer spending would have been close to flat.

Consumer spending is closely watched because it drives about 70 percent of economic activity. On Friday, the government said the economy grew at a 2.4 percent annual rate in the October-December quarter, down sharply from an initial estimate of a 3.2 percent rate.

Analysts said the drop in spending on goods in January as bad weather kept people from shopping might also have held down spending in February.

"Given that the weather was unusually severe in February too, the outlook is more uncertain than usual," said Paul Dales, senior U.S. economist at Capital Economics.

The 0.3 percent rise in income was partly influenced by temporary factors, such as the start of health care coverage in several areas under the Affordable Care Act. But the expiration of benefits for some long-term unemployed people acted to reduce income. Without those special factors, income would have risen 0.2 percent in January, the government said.

Inflation as measured by a price gauge tied to consumer spending remained moderate. It rose 0.1 percent in January and has risen 1.2 percent over the past 12 months, well below the Federal Reserve's 2 percent target.

Most of the revision in overall economic growth in the fourth quarter reflected a lower estimate for consumer spending, which grew at an annual rate of 2.6 percent during the quarter. That was down from an initial estimate of a 3.3 percent annual rate.

Part of the downward revision in spending reflected lower sales of autos and lower spending for non-durable goods than first thought. Analysts said the severe weather that hit much of the country was to blame for those reductions. Most think the harsh weather will also limit growth in the current January-March quarter.

Economists generally think overall growth this quarter will dip to an annual rate of around 2 percent. But they still foresee a rebound beginning in the April-June quarter and for the rest of the year. They expect that contained employment gains and a lessening of last year's drag of higher taxes and federal spending cuts will support growth this year.

Many forecast that the overall economy will grow at a solid 3 percent annual rate this year, up from 1.9 percent growth in the gross domestic product last year. That would be the best performance since the recession ended nearly five years ago.

But before growth rebounds, the economy must endure a soft patch caused by winter weather and decisions by companies to work down a buildup in their stockpiles before they step up spending again.

Once warmer weather arrives, many analysts expect a burst of spending caused by pent-up demand from consumers who put off spending for big-ticket items like autos during winter.

Federal Reserve Chair Janet Yellen testified to Congress last week that the Fed still expects the economy to strengthen this year. But she told the Senate Banking Committee that the Fed will be studying the data to make sure the slowdown is just a temporary weather phenomenon.

The Fed is gradually reducing its monthly bond purchases, which have been intended to keep long-term loan rates low to encourage spending and growth.

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GM, Ford, Toyota Feb. sales fall, weather blamed

DETROIT — General Motors, Ford and Toyota reported U.S. sales declines last month as frigid temperatures and snowstorms pounded much of the nation.

The country's top three automakers said the month started slowly but sales began to recover in the second half, a sign that fears of a broader auto sales slowdown may be unfounded. Chrysler and Nissan did report double-digit gains, but had to discount some key models to get there. Volkswagen, which has been struggling in the U.S., reported a 14 percent drop.

Industry analysts expect overall sales to rise about 1 percent for the month, a slow pace compared with the 8 percent increase for all of last year. Most blamed the weather, but some are wondering if the momentum of the past four years is waning.

Dealer inventories, especially for the Detroit automakers, have hit their highest level in five years, putting pressure on companies to clear their lots. At the end of January, dealers had an 89-day supply of cars and trucks, according to Ward's AutoInfoBank. Detroit automakers had the most, with General Motors at 114 days, followed by Ford at 107 and Chrysler at 105. A 60-day supply of vehicles is considered ideal.

To unload the inventory, automakers are offering more discounts. That means deals for consumers. Incentives are the highest they've been in three years, averaging $2,633 per vehicle in February, up more than 5 percent from a year ago, according to the TrueCar.

Larry Dominique, executive vice president of TrueCar, said automaker spending on discounts is growing faster than average sales prices, but he predicted that the bargains will wane as the weather gets warmer and customers go shopping again.

"We expect a return to balance once the winter subsides and inventories ease," he said.

GM says it sold just over 222,000 cars and trucks, led by the Chevrolet Cruze compact car, with sales up almost 22 percent. But sales of the Chevy Silverado pickup, GM's top-selling vehicle, fell 12 percent for the month.

Ford sold nearly 184,000 vehicles, but sales of cars fell almost 14 percent. Sales of the F-Series pickup, its top-selling vehicle, rose just under 3 percent.

Toyota sales fell 4 percent to just over 159,000 cars and trucks.

Chrysler and Nissan were able to lure customers onto icy-cold dealer lots by lowering prices on some key models.

Nissan said Monday that its sales were up almost 16 percent to just over 115,000. Chrysler sales rose 11 percent to nearly 155,000.

Chrysler was led by the Ram pickup with a 26 percent sales gain, while Nissan was led by the Rogue crossover SUV with sales up almost 73 percent.

Nissan's average sales price fell almost 4 percent — more than $1,000 — compared with a year ago, according to the TrueCar.com auto pricing site. While Chrysler's average sale price was up 6 percent, it boosted discounts on the Ram pickup, its most popular model, by $593 compared with a year ago, according to data collected by J.D. Power and Associates.

The Associated Press got the J.D. Power data from a person who asked not to be identified because the numbers aren't typically released to the public.

The Ram discounts averaged just under $5,000. Ford and General Motors, its main competitors, offered around $4,000 per pickup. Despite the Ram increase, discounts in the pickup segment were down $548 compared with a year ago, according to the data.

All automakers are due to report February sales on Monday.

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US construction spending up 0.1 percent in January

WASHINGTON — U.S. construction spending showed a tiny increase in January as strength in housing helped to offset declines in nonresidential building and government projects.

Construction spending edged up 0.1 percent in January, significantly slower than an upwardly revised 1.5 percent gain in December, the Commerce Department reported Monday.

Home building was up 1.1 percent in January with single-family construction rising 2.3 percent and apartment building up 1 percent.

However, there was widespread weakness outside of housing. Non-residential construction fell 0.2 percent and office building was flat, with bad weather likely a factor in the weakness.

Total government construction was down 0.8 percent in January compared with December.

Construction spending totaled $943.1 billion in January at a seasonally adjusted annual rate.

The 1.1 percent rise in housing construction was just half of the 2.5 percent gain in December.

Economists had expected the January weakness, believing that construction, like other parts of the economy, would be slowed by the unusually cold weather. However, the expectation is that builders will see better gains once spring and warmer weather arrive.

Most economists are looking for sales of new and existing homes to show further gains in 2014, bolstered by an improving economy and steady job growth.

Sales of new homes rose 9.6 percent in January to a seasonally adjusted annual rate of 468,000. It was the fastest pace since July 2008. The surge came as a surprise to economists. Most had expected a decline in January, in part because they thought purchases would be held back by winter storms in much of the country. Sales had fallen 3.8 percent in December and 1.8 percent in November, prompting concerns that the housing recovery might be losing momentum.

Housing, while still a long way from the boom of several years ago, has been recovering over the past two years. Residential construction has grown at double-digit rates and contributed about one-third of a percentage point to overall economic growth last year.

Economists expect home construction will rise in 2014 although at a slower pace than in 2013.

Economists are optimistic about further sales gains because they think the overall economy will strengthen this year as more people find jobs and last year's drag from higher federal taxes and government spending cuts eases.

One assumption underlying expectations on housing: Even as the Federal Reserve keeps scaling backs its bond purchases, which were used to keep long-term rates low, mortgage rates will rise only gradually this year.

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Stocks fall as Ukraine tensions rise; Gold gains

NEW YORK — Global stocks fell sharply on rising tension over Russia's military advance into Ukraine and the threat of possible sanctions by Western governments. Treasurys and gold prices rose as investors bought safer assets.

KEEPING SCORE: The Standard & Poor's 500 index fell 16 points, or 0.9 percent, to 1,843 as of 10:15 a.m. Eastern time. The Dow Jones industrial average fell 158 points, or 1 percent, to 16,163. The Nasdaq composite dropped 46 points, or 1.1 percent, to 4,260.

WORLD MARKETS: Markets fell even more sharply in Europe. Germany's DAX sank or 2.8 percent to 9,424. Britain's FTSE 100 dropped or 1.4 percent to 6,720 and Russia's benchmark stock index plunged 12 percent to 1,115.

SAFETY FIRST: Gold and bond prices rose as investors put money into safer assets. The price of gold gained $25.90, or 2 percent, to $1,347.50. The yield on the 10-year Treasury note fell to 2.62 percent from 2.65 percent late Friday.

ENERGY PRICES: The price of crude oil climbed $2.05, or 2 percent, to $104.64 a barrel following warnings by Washington and other governments that Russia, a major oil exporter, might face sanctions after it seized control of Ukraine's Crimean Peninsula. The energy sector was the only one of the 10 sectors in the S&P 500 to advance.

CONFIDENCE AT HOME: The tensions in the Ukraine outweighed positive reports on the U.S. economy. U.S. manufacturing expanded at faster pace in February as new orders and stockpiling rose.

Americans spent more in January, but the increase came from a surge in spending on heating bills during the harsh winter. Spending in areas such as autos and clothing declined. Spending rose 0.4 percent in January after a 0.1 percent gain in December the Commerce Department said Monday. The December figure was revised down from a 0.4 percent increase.

IT'S COLD OUTSIDE: Darden Restaurants, the parent company of Olive Garden, slumped $2.26, or 4.4 percent, to $48.80 after the restaurant operator said that exceptionally rough winter weather reduced earnings in its latest quarter by about 7 cents per share. Expenses related to the company's plan to split off its Red Lobster chain also hurt earnings.

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Olive Garden pins hopes on new logo, menu

ORLANDO, Fla. — Olive Garden has a plan to win back customers: a new logo and yet more menu changes.

In a call with analysts on Monday, executives at Darden Restaurants Inc. expressed confidence they could bring about a "brand renaissance" at the Italian chain with a new look and updated menu that presented food with "a sense of flair and sophistication." The changes include more small dishes and the option for people to mix and match pastas and sauces.

Darden executives also continued to make the case for why it made sense to hold onto Olive Garden and spin off or sell Red Lobster, rather than keeping the two struggling chains together and focusing on the company's more promising specialty restaurant unit, which includes Capital Grille and Yard House.

"We certainly recognize that industry dynamics have changed considerably over past two years," CEO Clarence Otis said during the call, acknowledging the need to make drastic changes.

The remarks came as Darden Restaurants Inc. reported preliminary quarterly results that fell short of Wall Street expectations as sales continue to slide at its two flagship chains. It said sales are expected to drop 5.4 percent at Olive Garden restaurants open at least a year. At Red Lobster, the figure is expected to fall 8.8 percent.

Customer traffic declines were even steeper, falling as much as 13 percent at Olive Garden in December and 19 percent at Red Lobster in January.

The Orlando, Fla.-based company said that exceptionally rough winter weather hurt results. But Darden has been battling shifting industry trends for years now, with people moving away from pricier casual dining chains where tips for waiters and waitresses push up the amount they spend on a meal. Darden has tried tweaking the menus and marketing for Olive Garden and Red Lobster to better suit today's eating habits, but the efforts have failed to take hold.

For the three months ended Feb. 23, Darden Restaurants Inc. said it expects to earn about 82 cents per share. Analysts expected a profit of $1.02 per share, according to FactSet. In addition to the bad weather, Darden said legal, advisory and other costs related to its plan to either spin off or sell Red Lobster hurt its profit.

Meanwhile, sales for the company's specialty restaurant group are expected to be down 0.7 percent at established locations. The metric is a key measure of a retailer's health because it excludes the volatility of newly opened and closed locations.

Excluding the impact of the weather and the shift in the timing of Thanksgiving, Darden said Red Lobster stores would have posted a decline of about 6.2 percent, while Olive Garden revenue at stores open at least a year would have fallen 2.8 percent and risen 2.9 percent at LongHorn Steakhouse locations. The specialty restaurant group would have posted a 1.9 percent increase.

The company backed its previous outlook for fiscal 2014, saying that it still expects earnings per share to decline 15 percent to 20 percent, excluding restructuring costs.

Shares of Darden were down more than 4 percent at $48.81.

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