China's currency is substantially undervalued and Beijing is moving too slowly to fulfill its promise to let it rise, Treasury Secretary Timothy Geithner said Wednesday in a speech in Washington. He said it is in China's own interests to accelerate the pace of currency reform, and the undervalued yuan is increasing the risk of inflation that will harm Chinese growth. He also mentioned widespread theft of U.S. intellectual property in China, Beijing's protection policies that hurt U.S. exporters, and accusations the government subsidizes Chinese businesses, violating World Trade Organization rules.
About 198,000 GE and Professional Series Brand portable dehumidifiers made in China and imported by GEA Products Lp of Louisville, Ky., have been recalled because they pose a fire hazard, the Consumer Product Safety Commission reports. A component in the compressor can short- circuit. There have been 14 reports of smoke and fumes and eight reports of fires but no injury reports. The 30-pint and 40-pint dehumidifiers were sold nationwide at Wal-Mart, Sam's Club, Home Depot and other retailers from February 2007 to June 2009. For details, call 877-593-8721 or go to recallverification.com.
Bank news helps lift stocks
Hopes that banks would start raising their dividends sent stocks sharply higher Wednesday. Indexes closed at their highest levels in more than two years after a successful bond auction in Portugal eased worries about Europe's debt crisis. Portugal borrowed $1.6 billion at a lower long-term interest rate than many expected. Investors have been concerned that Portugal will struggle with its debts and become the third European country to require a bailout after Greece and Ireland.
Analysts cautioned that it's still possible Portugal could need a financial lifeline if its economy slips back into recession this year.
Banks led the market higher after a Wells Fargo Securities analyst issued a report saying its earnings should grow much faster than other firms this year and that banks were likely to distribute more of their earnings to shareholders as dividends. JPMorgan Chase & Co. rose 2.5 percent to $44.71 after company CEO Jamie Dimon told CNBC late Tuesday that the bank hopes to raise its dividend in the second quarter. JPMorgan's stock led the 30 large companies that make up the Dow Jones industrial average, followed closely by Bank of America. Bank of America gained 2 percent to $14.99.
The Dow rose 83.56 points, or 0.7 percent, to close at 11,755.44. That's the Dow's highest close since Aug. 11, 2008. The Standard & Poor's 500 index also reached its highest level since Aug. 28, 2008. The index gained 11.48, or 0.9 percent, to 1,285.96. The Nasdaq composite rose 20.50, or 0.8 percent, to 2,737.33.
From wire reports