Business Highlights

———

Sluggish July sales show tight-fisted consumers

NEW YORK (AP) — Shoppers remained tight-fisted in July, raising concern about the back-to-school and holiday shopping seasons as well as for the broader economic recovery.

The big worry is that frugal parents will focus on outfitting their children this fall with just necessities like notebooks and jeans. And fear is bubbling up that frugal parents might consider any extra splurges early Christmas gifts.

The persistent pullback despite signs of a stabilizing economy could stall the overall recovery as consumers account for 70 percent of all economic activity.

The bargain-hunting played out again in the retailers' reports, with mall-based apparel stores faring the worst. Among the disappointments were Macy's Inc. and teen retailers Abercrombie & Fitch Co. and Wet Seal Inc. The few bright spots were apparel discounters.

———

Fannie Mae seeks $10.7B in US aid after 2Q loss

WASHINGTON (AP) — Fannie Mae says it needs an additional $10.7 billion in government aid after posting a loss of $15.2 billion in the second quarter as the taxpayer bill from the housing market bust keeps growing.

The mortgage finance company, seized by federal regulators last September, posted a quarterly loss of $2.67 per share. That compares with a loss of $2.6 billion, or $2.54 per share, in the year-ago period.

The results were driven by $18.8 billion in credit losses due to declining housing market conditions. The request for federal aid is Washington-based Fannie Mae's third since the takeover. It has received about $34 billion so far.

———

As jobless claims fall, layoffs could slow further

WASHINGTON (AP) — In a positive sign for the economy, companies are laying off fewer workers as they prepare to ramp up production to replenish their depleted stockpiles of goods.

Many analysts pointed to Thursday's drop in jobless claims as evidence of a trend signaling fewer job losses in coming months, particularly compared with the flood of layoffs earlier this year.

Still, job openings remain scarce. And most economists expect the unemployment rate to keep rising to 10 percent or higher by the end of this year. On Friday, the government will report the July unemployment rate.

First-time claims for jobless benefits dropped to a seasonally adjusted 550,000 last week, down from 588,000 in the previous week, the Labor Department said Thursday. The four-week average of claims, which smooths out fluctuations, dropped to 555,250, its lowest point since late January.