April 17, 2012
By Nancy Shute
“Now this is what is wrong with the food people are eating in America. A bacon sundae – are you kidding?!” –KTRN
Is Burger King’s new bacon sundae a delightful concept, or the most recent example of all that’s wrong about American food?
That’s pretty much the divide in opinion here at Salt Central, as well as in online forums and social media, where the bacon sundae is inspiring fierce debate. “Really? I know sales are low and all but REALLY?” questioned one Twitter skeptic. “Americans eat death, pay for the privilege,” added another. Countered by an enthusiast who typed: “IT’S ABOUT TIME!”
That’s a lot of passion for a $2.49 menu item available only at a handful of Burger Kings in Nashville, Tenn. “The company is currently testing menu items in a small sampling of U.S. restaurants,” spokesperson Randi Farynyk told The Salt. “The brand does not have plans to expand the test to additional markets at this time.”
Drat. Count me among the staffers here who said “Yeah!” when the sweet-salty-savory news broke. Since NPR wasn’t popping for a road trip, I had to turn to Sam Bradley, a 27-year-old Nashville resident I found on Twitter, for confirmation. She had already trundled over to her local Burger King to check it out.
April 13, 2012
By CBS News
“This is what is wrong with chain restaurants. At first glace, you might think this is an American idea. Nope, this is available in the UK only. This should automatically warn you that Pizza Hut does not care about the food they serve or the health and well being of their customers. There is nothing wrong with the occasional pizza – homemade, whole wheat and organic.” –KTRN
Pizza with hot dogs baked into the crust exists now. Because in a world where people line up for KFC’s Double Down and Maple Bacon Sundaes from Burger King, why not?
Pizza Hut U.K. is the latest fast food franchise to hop aboard the extreme cuisine trend with their newest menu item, billed as “succulent hot dog sausage bursting from our famous stuffed crust with a FREE Mustard Drizzle.”
April 2, 2012
By Tony Isaacs
Would you knowingly eat ground beef which contained scrap meat items such as muscle connective tissue which had been sprayed with ammonium hydroxide? Would you want your children to eat such ground beef in their school lunches? According to recent revelations, if you or your children eat ground beef there is a strong chance that both may be happening.
Last week, former United States Department of Agriculture (USDA) scientist-turned-whistleblower Gerald Zirnstein revealed that 70 percent of the ground beef sold at supermarkets contained the fake-meat additive which is commonly referred to as “pink slime”. This revelation came on the heels of reports that the USDA is purchasing 7 million pounds of the product for school lunches in public schools.
“Pink slime” is taking over ground beef at our grocers and schools
“Pink slime” is made by gathering beef waste trimmings, simmering them at low heat to make it easy to separate fat from the muscle, and using a centrifuge to spin the waste trimmings to complete the separation. Next, the mixture is sent through pipes and sprayed with ammonium hydroxide gas to kill bacteria. Finally, the product is packaged into bricks, frozen and shipped to grocery stores and meat packers, where it is added to most ground beef.
The beef trimmings are particularly susceptible to contamination and were once relegated to pet food and cooking oil. However, Beef Products Inc. (BPI), the makers of “pink slime, commissioned a study which reportedly demonstrated that the ammonia process would kill E. coli as well as salmonella. Ever since the study, use of “pink slime” in ground beef has increased.
In 2009, theNew York Timesreported that despite the added ammonia, tests of “pink slime” across the country revealed dozens of instances ofE. coliand salmonella. According to the Times,E. coliwas found three times and salmonella 48 times between 2005 and 2009, including two contaminated batches of meat totaling 27,000 pounds.
Zirnstein, who first coined the term “pink slime” in a USDA memo, told ABC news “It’s economic fraud. It’s not fresh ground beef. …It’s a cheap substitute being added in.”
Zirnstein and fellow USDA scientist Carl Custer both warned against using what the industry calls “lean finely textured beef,” but they were overruled by their government bosses. The “pink slime” does not have to appear on the adulterated ground beef labels because, over objections of its own scientists, USDA officials with links to the beef industry labeled it meat.
The woman who made the decision to approve the mix is former undersecretary of agriculture, Joann Smith. Her decision led to hundred of millions of dollars for BPI.
“The under secretary said, ‘it’s pink, therefore it’s meat,’” Custer told ABC News.
When Smith left the USDA in 1993, she was appointed to the board of directors for BPI’s principal major supplier where she reportedly made at least $1.2 million over the next 17 years. The USDA said that, while Smith’s appointment was legal at the time, she could not have immediately joined the board under current ethics rules.
News of the USDA’s plan to bring 7 million pounds of “pink slime” to school cafeterias nationwide comes just weeks after the government announced new guidelines to ensure students are given healthier options for school meals. Notably, the USDA purchase comes after fast food chains such as McDonald’s, Taco Bell and Burger King have discontinued use of “pink slime.”
A public outcry against the “slime” is perhaps led most prominently by celebrity chef Jamie Oliver, who has also waged war successfully against flavored milk in Los Angeles schools.
Learn more at Natural News
March 26, 2012
By Mike Barrett
“Once again – more evidence that fast food is the last thing you should ever consider eating.” –KTRN
It is no secret that the average American diet is in completely in the slumps. Consuming packaged foods, fast food, artificially enhanced products, and especially low quality cheap food is the norm, but is it any wonder that being overweight while also falling victim to a host of illnesses is also the norm. Being raised in this era of poor health makes it difficult to know what is truly healthy and unhealthy. Food has drastically changed since decades ago, and so parents often aren’t aware of the severe decline in food quality. Fast food in particular is one of the primary reasons for the drastic health decline seen today.
If you haven’t already, take a couple of hours to watch the films Super Size Me or Fast Food Nation. After watching these films, you can see first hand how fast food causes severe damage to your body – even if you don’t consume it for every meal of every day like in one of the films. Fast food is nothing but a concoction of harmful and health-damaging chemicals which can easily be understood if you were to think for a moment how any restaurant could offer a double cheeseburger for only $1.
Most recently it was uncovered that these $1 cheeseburgers, along with the rest of McDonald’s’ beef and chicken, were actually harnessing ‘pink slime’ scrap meat covered with ammonium hydroxide. Not only does this fake meat provide no nutritional value at all, but it is chemically contaminated from ammonia, the toxic cleaning agent found under the sink. The meat is actually fat trimmings and connective tissue that are separated from the bone – scrap meat that is not fit for human consumption. The ammonia treatment is in response to the danger of contamination from salmonella or E. coli, but the scrap meats themselves are more likely to contain pathogens. Despite the chemical treatment, the meat is still in the line of fire for contamination.
Additionally, McDonald’s McNuggets contain 7 different ingredients making up the ‘meat’, many of which contain sub-ingredients. Instead of using real meat, the ingredient list utilizes sodium phosphate, safflower oil, wheat starch, dextrose, and autolyzed yeast extract – a particularly dangerous substance very similar to the toxic MSG. Along side with these ingredients comes the use of dimethylpolysiloxane, a silicon substance used as an anti-foaming agent and often found in breast implants and silly putty.
February 2, 2012
By Monica DyBuncio
McDonald’s is axing “pink slime” from its burgers, after receiving heat from celebrity chef and food activist Jamie Oliver, CBS This Morning reported.
What is pink slime? It’s the name Oliver has given to fatty beef trimmings soaked in ammonium hydroxide, which removes bacteria and makes the beef taste better.
“We’re taking a product that would be sold in its cheaper form for dogs,” Oliver said on his TV show, Food Revolution, where he demonstrated the practice. “After this process, we can give it to humans.”
The technique is approved by the United States Department of Agriculture and the Food and Drug Administration.
Last week, McDonald’s announced it’s no longer using the beef product, although the chain said in a statement that this decision “was not related to any particular event.” Taco Bell and Burger King have also agreed to stop using the additive, according to the Huffington Post.
Oliver isn’t the only one to raise issue with the controversial “slime.” The New York Times questioned the safety of the process in 2009.
January 12, 2012
“I guess the good news here is that McDoanlds is stopping the use of an ammonia-treated burger ingredient. But the real question is why the hell were they using it to begin with? They claim their burgers are 100% USDA beef. That is a blatant LIE! How do they get away with it and still sleep at night? The biggest question: Why is anyone still eating fast food? ‘This Stuff’ll Kill Ya’” –KTRN
McDonald’s and two other fast-food chains have stopped using an ammonia-treated burger ingredient that meat industry critics deride as “pink slime.”
The product remains widely used as low-fat beef filling in burger meat, including in school meals. But some consumer advocates worry that attacks on the product by food activist Jamie Oliver and others will discourage food manufacturers from developing new methods of keeping deadly pathogens out of their products.
The beef is processed by Beef Products Inc. of Dakota Dunes at plants at Waterloo, Iowa, and in three other states. One of the company’s chief innovations is to cleanse the beef of E. coli bacteria and other dangerous microbes by treating it with ammonium hydroxide, one of many chemicals used at various stages in the meat industry to kill pathogens.
“Basically, we’re taking a product that would be sold at the cheapest form for dogs, and after this process we can give it to humans,” Oliver said in a segment of his ABC television show, Jamie Oliver’s Food Revolution, that aired last spring.
BPI, which once boasted of having its product in 70 percent of the hamburger sold in the country, has lost 25 percent of its business. McDonald’s has been joined by Taco Bell and Burger King in discontinuing use of the product, and the company is worried other chains and retailers will follow them.
“It’s just a shame that an activist with an agenda can really degrade the safety of our food supply,” said David Theno, an industry consultant who has advised BPI and is credited with turning the Jack in the Box burger chain into a model of food safety after a deadly E. coli outbreak in 1993. He called the BPI process “extraordinarily effective” in making beef safer.
November 22nd, 2010
By: Justin Pritchard
Drinking glasses depicting comic book and movie characters such as Superman, Wonder Woman and the Tin Man from “The Wizard of Oz” exceed federal limits for lead in children’s products by up to 1,000 times, according to laboratory testing commissioned by The Associated Press.
The decorative enamel on the superhero and Oz sets – made in China and purchased at a Warner Brothers Studios store in Burbank – contained between 16 percent and 30.2 percent lead. The federal limit on children’s products is 0.03 percent.
The same glasses also contained relatively high levels of the even-more-dangerous cadmium, though there are no federal limits on that toxic metal in design surfaces.
In separate testing to recreate regular handling, other glasses shed small but notable amounts of lead or cadmium from their decorations. Federal regulators have worried that toxic metals rubbing onto children’s hands can get into their mouths. Among the brands on those glasses: Coca-Cola, Walt Disney, Burger King and McDonald’s.
The testing was part of AP’s ongoing investigation into dangerous metals in children’s products and was conducted in response to a recall by McDonald’s of 12 million glasses this summer because cadmium escaped from designs depicting four characters in the latest “Shrek” movie.
The New Jersey manufacturer of those glasses said in June that the products were made according to standard industry practices, which includes the routine use of cadmium to create red and similar colors.
To assess potential problems with glass collectibles beyond the “Shrek” set, AP bought and analyzed new glasses off the shelf, and old ones from online auctions, thrift shops and a flea market. The buys were random.
The fact it was so easy to find glasses that appeal to kids and appear to violate the federal lead law suggests that contamination in glassware is wider than one McDonald’s promotion.
The irony of the latest findings is that AP’s original investigation in January revealed that some Chinese manufacturers were substituting cadmium for banned lead in children’s jewelry; that finding eventually led to the McDonald’s-Shrek recall; now, because of the new testing primarily for cadmium in other glassware, lead is back in the spotlight as well.
AP’s testing, conducted by ToyTestingLab of Rhode Island, found that the enamel used to color the Tin Man had the highest lead levels, at 1,006 times the federal limit for children’s products. Every Oz and superhero glass tested exceeded the government limit: The Lion by 827 times and Dorothy by 770 times; Wonder Woman by 533 times, Superman by 617 times, Batman by 750 times and the Green Lantern by 677 times.
Federal regulators will decide whether the superhero and Oz glasses are “children’s products” and thus subject to strict lead limits; if U.S. Consumer Product Safety Commission staffers conclude the glasses to fall outside that definition, the lead levels would be legal.
Judging by the agency’s own analysis, obtained by the AP under the Freedom of Information Act, the Oz and superhero glasses appeal to kids.
“Licensed characters based on action superhero themes or friendship themes are very popular” with children ages 6 to 8, CPSC staff wrote when explaining why the “Shrek” glasses, which featured the cartoon ogre and his friends, would end up in children’s hands.
Warner Brothers said, “It is generally understood that the primary consumer for these products is an adult, usually a collector.”
However, on Warner Brothers’ website, the superhero glasses are sold alongside kids’ T-shirts with similar images and a school lunch box. An online retailer, www.retroplanet.com, describes the 10-ounce glasses as “a perfect way to serve cold drinks to your children or guests.”
The importer, Utah-based Vandor LLC, said it “markets its products to adult collectors.” The company said less than 10,000 of each set had been sold and that the products were made under contract in China.
The company said that superhero and “Oz” glasses both passed testing done for Vandor by a CPSC-accredited lab, including the same lead content test that ToyTestingLab did for AP – a test only required of children’s products. Spokeswoman Meryl Rader did not answer when asked why a test specific to children’s products would be performed on glasses the company said were not intended for kids.
“The results were well within the legal limits” of 0.03 percent lead, Rader wrote in an e-mail. The company would not share those results.
Informed in general terms of AP’s results, CPSC spokesman Scott Wolfson said that the agency would pursue action against any high-lead glasses determined to be children’s products. The agency has authority to enforce lead levels for glasses going back decades, he said.
AP’s testing showed Vandor’s Chinese manufacturer also relied on cadmium. That toxic metal comprised up to 2.5 percent of the decorative surface of the Oz and superhero glasses, nearly double the levels found in the recalled “Shrek” glasses. But the CPSC only limits how much cadmium escapes from the designs, not how much cadmium the designs contain. Even that regulation is new: The CPSC used the “Shrek” glasses to establish a standard for how much cadmium coming out of children’s glassware creates a health hazard.
Five of the glasses that AP tested, including one ordered from the online Coca-Cola store, shed at least as much cadmium as the CPSC found on the “Shrek” glasses. While those five could have been deemed a health hazard under the CPSC guidelines used for the recall, recent revisions tripled the allowable amount of cadmium and the agency may no longer consider them a problem. The agency has said its upward revision means the “Shrek” glasses did not need to be recalled.
The all-red Coke glass shed three times more cadmium than the Puss in Boots “Shrek” glass that worried federal regulators the most last summer. Coke Zero and Diet Coke glasses did not exhibit the same problem.
The Coca-Cola Co. said it requires safety and quality testing of all items it licenses. Previous testing showed the glass “complied with all relevant regulations, including with respect to cadmium. We are now retesting the decorative glasses to confirm those results.”
In all, AP scrutinized 13 new glasses and 22 old ones, including glasses sold during McDonald’s promotion for a 2007 “Shrek” movie. The used glasses date from the late 1960s to 2007, mostly from promotions at major fast-food restaurants. Thousands of such collectibles are available at online auction sites; countless others are kept in American kitchen cabinets, and used regularly by children and adults.
November 17th, 2010
By: Tom Philpott
Last week, I praised fast food, which has probably been around as long as people have lived in cities.
But there’s a particular type of fast food that goes back just a half-century, dating to the post-war rise of car-centered cities and suburbs. It relies on regimentation, weird additives, flavor “engineering,” super-cheap (but highly subsidized) ingredients, and super-expensive marketing. I won’t bore you with why I think this type of fast food sucks; wouldn’t want to be labeled a food snob!
But let’s talk about that marketing. Yale’s Rudd Center for Food Policy and Obesity has just put out an extraordinary report on fast-food industry marketing.
Here’s the report’s headline number: $4.2 billion, which is how much the industry spent marketing its wares in 2010.
To put that amount in perspective, consider the Center for Nutrition Policy and Promotion, the USDA’s sub-agency that “works to improve the health and well-being of Americans by developing and promoting dietary guidance that links scientific research to the nutrition needs of consumers.” Its annual budget? $6.5 million, according to The New York Times reporter Michael Moss.
So $4.2 billion vs. $6.5 million. That means that for every $1 the industry spends haranguing Americans to eat stuff like Burger King’s 2,500-calorie Pizza Burger, about a tenth of a penny gets spent urging folks to eat their spinach.
And of course, as Moss’ superb recent piece shows, the USDA also openly collaborates with the industry to cajole people to eat more corporate fast food.
A $4.2 billion marketing budget in 2009, a year characterized by a brutal economic slump, is the sign of an extremely profitable industry. Corporate fast food is what is known as a “countercyclical” industry — it tends to thrive when the economy goes to hell. When money is tight, McDonald’s dollar menu looks like a bargain — and stuff like Domino’s now-infamous eight-cheese Wisconsin Pizza seems like a reasonable indulgence.
How well are these companies doing? The stock market gives us a clue. Over the past two years, shares of Yum! Brands (owner of owner of KFC, Pizza Hut, Taco Bell, and Long John Silver’s) and McDonald’s have both more than doubled. Meanwhile, the overall stock market, as measured by the S&P 500 index of the nation’s largest publicly traded companies, has flat-lined. In other words, investors are quite bullish on junk food corporations.
When times are flush, the industry is using its $4.2 billion marketing stash largely to cultivate new generations of customers: i.e., kids. The Rudd report doesn’t estimate how much of the fast-food industry’s marketing budget is directed at children (a 2006 study estimated a tidy $1.6 billion), but it offers a dizzying array of data to demonstrate the industry’s devotion to this dubious cause. Get this:
The average preschooler (2-5 years) saw 2.8 TV ads for fast food every day in 2009; children (6-11 years) saw 3.5; and teens (12-17 years) saw 4.7.
People have been scolding the fast-food industry for marketing its wares to kids for years. The industry’s response? A ramped-up effort to market its wares to kids:
Compared to 2003, preschoolers viewed 21% more fast food ads in 2009, children viewed 34% more, and teens viewed 39% more. … McDonald’s and Burger King have pledged to improve food marketing to children. However, both restaurants increased their volume of TV advertising from 2007 to 2009. Preschoolers saw 21% more ads for McDonald’s and 9% more for Burger King, and children viewed 26% more ads for McDonald’s and 10% more for Burger King.
There’s also an uncomfortable racial aspect to fast-food marketing — these companies evidently see major opportunity in selling product to African-American and Hispanic families:
McDonald’s and KFC specifically targeted African American youth with TV advertising, websites, and banner ads. African American teens viewed 75% more TV ads for McDonald’s and KFC compared to white teens.
How is all of this marketing working? The proof is in the whining. In a survey commissioned by the Rudd Center, 40 percent of parents report that their children ask to go to McDonald’s at least once a week, and 15 percent of parents of 2- to 5-year-olds report that their children harangue them for a Mickey D’s trip every day. As a result:
Eighty-four percent of parents reported taking their child to a fast food restaurant at least once in the past week; 66% reported going to McDonald’s.
What to make of all of this? To me, it underscores the importance of the National School Lunch Program. School lunches are our society’s most concrete, tangible way of transmitting foodways to rising generations. The public-school cafeteria is where we create a public vision of what the food system should be. In short, it’s the public contribution to the formation of kids’ eating habits. And it is in the cafeteria, I think, where the fast-food industry’s marketing efforts could be effectively rebuffed.
Unfortunately, I don’t have much good news here, either. Currently, we spend about $11 billion annually on school lunches — of which two-thirds goes to overhead and labor costs. That leaves about $4 billion to spend on ingredients — roughly equal to the fast food industry’s marketing annual budget. Per child, schools have about 90 cents per day to spend on ingredients.
At those levels of funding, it’s no wonder that public-school administrators are increasingly outsourcing cooking to … the fast-food industry, which knows a thing or two about engineering low-quality ingredients into something people will crave. And guess what? The USDA is cheering them on. Listen several minutes into this boring radio clip, and you’ll hear a Domino’s exec babbling about how USDA officials are helping the company get its pizza into school cafeterias. And if that doesn’t kill you, here’s a report about a Connecticut town that has invited McDonald’s PR flacks into its public schools to provide nutritional counseling.
There are school districts that are trying to teach kids other visions of what food is. Grist contributor and parent-turned-school-lunch-activist Ed Bruske is writing about the one in Boulder, Colo., right now — and how it’s struggling to balance the budget after tossing the junk food out.
Meanwhile, San Francisco is about to become the first major city to ban chains from providing toys in certain fast-food meals. The measure has aroused scorn — what will San Francisco ban next? the Times’ Freaknomics blog asked. But when cash-strapped parents and school districts are up against $4.2 billion in carefully plotted ways to get kids to beg for fast food, any public effort to fight back seems welcome.
November 9th, 2010
By: Andrew Schneider
You might have thought that with all the finger-pointing and concerns over childhood plumpness, America’s fast- food industry would be trying to reduce the gut-busting, calorie-loaded, fat-filled offerings on their menus and the kid-targeted advertising.
Not so, say researchers from Yale University’s Rudd Center for Food Policy & Obesity who released today what they say is the “most comprehensive study of fast-food nutrition and marketing ever conducted.”
The researchers studied marketing efforts of 12 of the nation’s largest fast-food chains, and examined the calories, fat, sugar and sodium in more than 3,000 kids’ meal combinations and 2,781 menu items.
“Despite pledges to improve their marketing practices, fast-food companies seem to be stepping up their efforts to target kids,” said Jennifer L. Harris, the report’s lead researcher. “Today, preschoolers see 21 percent more fast-food ads on TV than they saw in 2003, and somewhat older children see 34 percent more.”
The report also found:
- Out of 3,039 possible kids’ meal combinations, only 12 meet the researchers’ nutrition criteria for preschoolers. Only 15 meet nutrition criteria for older children.
- Teens ages 13-17 purchase 800-1,100 calories in an average fast-food meal, roughly half of their recommended total daily calories.
- At most fast-food restaurants, a single meal contains at least half of young people’s daily recommended sodium.
- A detailed analysis of the study’s methodology is available on the Rudd Center’s website.
McDonald’s spokesperson Neil Golden said this morning that the company “remains committed to responsible marketing practices … and … to offering our customers a wide variety of quality food and beverage choices that meet their dietary needs and tastes — including fruit, juice and dairy options in our Happy Meals.”
A spokesperson for the National Restaurant Association echoed Golden’s defense, without directly addressing the results of the study. Sue Hensley also noted that the industry supported the law that will “soon require calories on the menu in 200,000 restaurant locations nationwide.”
Beyond the Yale report, AOL News researched the breakdown of calories in the kids meals and found these totals at the websites of the largest fast food chains:
McDonald’s — Happy Meal cheeseburger, low-fat chocolate milk and small fries, 650 calories.
Wendy’s — Cheeseburger, Kids’ Meal fries and a low-fat chocolate milk, 650 calories.
Jack in the Box — Kids Meals cheeseburger, small fries and low fat chocolate milk, 800 calories.
Burger King — Kids Meal small cheeseburger, small fries and a low-fat chocolate milk, 820 calories.
KFC — Kid-size popcorn chicken, potato wedges and lemonade, 750 calories.
The number of calories are often doubled or tripled by substituting other menu selections, AOL News was told when it checked with managers and counter people at the five chains in Seattle. The consensus among those interviewed was that kids 8 and older rarely go for these smaller portions, with large fries, sodas and bigger hamburgers more the norm, especially if their parents were not doing the ordering.
What is the federal government doing to thwart spreading juvenile waistlines? Its schizophrenic approach confounds many nutritionists and public health experts.
Sunday’s New York Times detailed a bizarre operation where a U.S. Department of Agriculture dairy promotion group funded a $12 million campaign to develop and market a new Domino’s pizza pie that has six cheeses on top and two more in the crust where “one slice contains as much as two-thirds of a day’s maximum recommended amount of saturated fat.”
Yet another arm of the USDA, its Center for Nutrition Policy and Promotion, is urging consumers to reduce the consumption of these calories-filled, high fat cheeses.
On a local level, however, San Francisco’s Board of Supervisors last week did attempt to take the happy out of happy meals when it approved an ordinance that would prevent fast-food chains from giving away toys with children’s meals that are overloaded with calories, salt and fat. It also decreed that any meals accompanied by promotional toys has to be served with fruits or vegetables.
If San Francisco’s mayor doesn’t veto the slimming legislation, it would become law in December.
Just after the vote, a McDonald’s spokeswoman told reporters that the company was extremely disappointed with the decision. “It’s not what our customers want, nor is it something they asked for,” she said.
Today’s Yale report makes it clear that the fast-food industry shouldn’t protest too much about the criticism.
September 1, 2010
by Abby Schultz
Stocks surged the first trading day of September after a report showed U.S. manufacturing has surprising strength, and after news of strength in the global economy. The markets also shrugged off news of a decline in auto sales.
The Dow Jones Industrial Average rose more than 240 points. All 30 Dow components were higher, led by Caterpillar [CAT 68.0601 2.9001 (+4.45%)], Bank of America [BAC 13.05 0.59 (+4.74%)], and General Electric [GE 15.01 0.53 (+3.66%)].
The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell more than 6 percent, below 25.
The mood in the market was brighter Wednesday after a glum August, and a day after the Dow eked out a 5 point gain. In a piece of good news, the Institute for Supply Management’s monthly manufacturing index for August came in at 56.3, much better than the expected drop to 52.5 for August. The July reading was 55.5.
Stocks were already higher before the manufacturing report following news of a rebound in Chinese manufacturing. The Chinese data, coupled with positive economic reports out of Australia, India and Germany, confirmed “global demand remains intact,” said Quincy Krosby, market strategist at Prudential Financial.
The market also likely gained support from a first-of-the-month influx of buying, which is typical, Krosby said. The key, she added, will be if Wednesday’s gains are driven by strong volume, unlike what has been seen throughout the summer when volume picked up on the downside and decreased on the upside.
August auto sales at Ford[F 11.624 0.339 (+3%)] fell 7.1 percent year-over-year, more than the 4.1 percent decline expected. Earlier Wednesday, General Motors reported its August sales fell 7 percent year-over-year, the automaker reported Wednesday morning. Analysts expected a drop-off, given that August 2009 saw accelerated sales from the “cash for clunkers” program.
Apple [AAPL 250.8741 7.7741 (+3.2%)] has scheduled a media event at 1 p.m. where it is expected to unveil the newest versions of the iPod, and possibly new features for Apple TV. The Financial Times reports that Sony [SNE 28.84 0.85 (+3.04%)], meanwhile, will launch a new music and video download service designed to challenge Apple, as it holds its own media event in Berlin.
Elsewhere among technology stocks, Amazon.com [AMZN 130.48 5.65 (+4.53%)] is reportedly entering the business of delivering TV over the Internet, according to a report in The Wall Street Journal.
In other news, shares of Burger King Holdings [BKC 18.865 2.415 (+14.68%)] spiked after news the fast-food chain is considering a possible sale and has been holding talks with potential buyers, according to reports.
Many retailers surged Wednesday after news that state sales-tax holidays and back-to-school buying boosted sales. The report by SpendingPulse, an information service by MasterCard Advisors, was less optimistic about the future, noting consumers remain cautious.
Shares of Saks [SKS 7.41 -0.49 (-6.2%)], however, were lower a day after the luxury retailer rose more than 14 percent on unconfirmed takoever talk. Meanwhile, JP Morgan downgraded Saks to “neutral.”
Meanwhile, Caterpillar is surging after news it is expanding manufacturing capacity in Brazil. Leading the industrial sector Wednesday is Cummins [CMI 79.80 5.39 (+7.24%)], which is up more than 7 percent. An official with General Electric [GE 15.015 0.535 (+3.69%)], meanwhile, said the conglomerate could spend as much as $30 billion on acquisitions within two to three years. Shares of GE, the parent company of CNBC, were up more than 3 percent.
Among financial stocks, up more than 3 percent as a group, Bank of America rose more than 4 percent after a federal judge approved a settlement with the Securities and Exchange Commission. The SEC was concerned with bonuses paid to Merrill Lynch employees before BofA’s purchase of the investment bank in January 2009.
In earnings news, shares of Heinz [HNZ 46.16 -0.08 (-0.17%)] were slightly lower following news the maker of ketchup and Ore-Ida French fries earned more than expected thanks to strong sales in emerging markets. Heinz is expecting to reports earnings of 75 cents a share, better than the 73 cents forecasted by analysts polled by Thomson Reuters.
On the economic front, construction spending, meanwhile, slumped 1.0 percent in July to $805.2 billion, the lowest level in 10 years, the Commerce Department reported. Figures for June were revised to an 0.8 percent fall, instead of the 0.1 percent gain previously reported.
Earlier Wednesday, the Mortgage Bankers Association reported applications for home purchassing and refinancing rose last week amid the lowest interest rates since 1990.
A report from ADP and Macroeconomic Advisors showed the private sector lost 10,000 jobs from July to August largely due to a drop of 40,000 jobs in the goods-producing sector. The news was offset somewhat by a separate report from Challenger, Gray & Christmas showing that planned layoffs hit a 10-year low in the month.