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• Ex-First Republic holders sue Merrill
  

  Former shareholders of First Republic Bank sued Merrill Lynch & Co. on Friday, alleging the company hid billions of dollars in subprime mortgage-related losses while the two companies' combination was pending.The suit, filed in New York, seeks class-action status, unspecified damages for shareholder losses and a jury trial. Top Merrill executives, including former CEO Stan O'Neal, were also named as defendants.The Wall Street bank agreed in January to buy San Francisco-based First Republic for about $1.8 billion in cash and stock.In October, a month after the deal closed, Merrill reported that it was taking a writedown of about $8 billion in the third quarter because of the declining value of mortgage-backed debt. The writedown - the largest in Merrill's history - wiped out the bank's earnings for 2006.Merrill officials said errors in risk management contributed to the staggering loss, but none of that information was disclosed in the registration or proxy statements on the merger, according to the lawsuit.As a result, First Republic shareholders were relying on "materially false and misleading" statements before approving the sale to Merrill, the suit alleged.Merrill disputed the claims: "We made all appropriate disclosures," Bill Halldin, a spokesman for Merrill, said.Merrill's O'Neal was ousted in November in the wake of the mortgage-lending crisis that has led to an estimated total of $105 billion in losses this year alone for global banks.The case was filed in the U.S. District Court, Southern District of New York by the law firms of Pomerantz, Haudek, Block, Grossman & Gross LLP and Cotchett, Pitre & McCarthy.

• Soybeans fall, gold closes higher
  By JACKIE FARWELL

  Soybean futures fell Friday, pulling back after touching a 34-year high on expectations for robust exports next year and continued strong demand from China.Gold prices climbed almost $11 an ounce, boosted by strong oil prices, weak economic data in the U.S., and world political concerns following Thursday's assassination of Pakistani opposition leader Benazir Bhutto.Wheat futures dropped sharply and oil prices fell. Trading was light in most financial markets due to the holiday season, and that tended to exaggerate many price movements including the turnaround in soybeans.U.S. exporters have already sold roughly three-quarters of the soybeans the Agriculture Department predicts for the whole marketing year, which ends in June 2008. To make up for dwindling inventories, analysts say farmers need to plant more soybeans than they did last year - when an ethanol boom led farmers to favor planting corn acres over soybeans.So far this year, soybean exports are running at 735 million bushels, or about 74 percent of the USDA's total estimate of 995 million bushels. Last year, the farmland dedicated to soybean plantings was reduced by 15 percent.Feeding Friday's record was continued strong demand from China, the world's largest consumer of soybean oil, said DTN commodities analyst Elaine Kob."It's really been an impressive week for soybeans," she said.A bushel of soybeans for March delivery settled down 8.5 cents at $12.23 a bushel. The price had jumped to $12.48 overnight, beating June 1973's closing high of $12.10 but still shy of that day's trading record of $12.90 a bushel.Wheat for March delivery fell 26.25 cents to $9.15 a bushel. March corn fell 2.75 cents to $4.52 a bushel, while March oats traded flat, settling at $$3.09 a bushel.Gold prices advanced on the precious metal's appeal as a safe haven investment during political uncertainty. Bhutto's assassination in a suicide bombing has stirred investor worries about further instability in the region."The geopolitical background continues to unnerve a lot of people," said Jon Nadler, senior analyst at Kitco Bullion Dealers, adding that gold has "the potential to close out the year at its very peak."The dollar's steep drop against the 13-nation euro this year has been a major driver behind gold's advance from less than $650 an ounce in January to a 28-year high near $850 an ounce in November. Gold futures are up nearly 32 percent this year, Nadler said.An ounce of gold for February delivery added $10.90 to settle at $842.70 on the New York Mercantile Exchange. March silver climbed 0.077 cent to $14.895 an ounce, and Nymex copper for March delivery fell 6 cents to close at $3.0720 a pound.The dollar fell against the euro and yen in late New York trading, but strengthened versus the pound.Hampering the rise of gold and other commodities was a government report showing sales of new homes fell in November to their lowest level in more than 12 years.The Commerce Department said new home sales fell 9 percent from October to a seasonally adjusted annual rate of 647,000.(This version CORRECTS SUBS 9th graf, bgng Wheat for ... to correct corn quote, price change.)

• Stocks end mixed after housing data
  By TIM PARADIS

  Wall Street finished an erratic week narrowly mixed Friday after a government report of a steep decline in new home sales stirred concerns that weakness in housing will continue to dog the economy. The major indexes lost ground for the week.The Commerce Department report that new home sales fell 9 percent from October to a seasonally adjusted annual rate of 647,000 triggered renewed nervousness that consumers could become uneasy and tamp down their spending.Stocks, which fell more than 1 percent Thursday following unwelcome economic readings and the assassination of Pakistani opposition leader Benazir Bhutto, fluctuated through the day Friday. The Chicago purchasing managers' index had for a time offered some support to investor sentiment Friday after it showed a stronger-than-expected increase for December manufacturing activity in the Midwest.But Wall Street appeared unable to hold onto its enthusiasm for too long - repeating a pattern that has become commonplace since the summer. Investors are eager for any economic data that can help illuminate whether weakness in the housing and financial sectors is undercutting the overall economy, possibly leading to a recession.Quincy Krosby, chief investment strategist at The Hartford, contends the news from growth in Midwest manufacturing to the weak housing report could have an outsize effect on stocks because of the session's light volume."What you have is a very thinly traded market so any news, whether it's good news or bad news, can skew the market actually quite dramatically one way or the other," she said.The Dow Jones industrial average rose 6.26, or 0.05 percent, to 13,365.87, after bobbing higher and lower throughout the session.Broader stock indicators were mixed. The Standard & Poor's 500 index rose 2.12, or 0.14 percent, to 1,478.49, and the Nasdaq composite index fell 2.33, or 0.09 percent, to 2,674.46.For the week, the Dow lost 0.63 percent, the S&P 500 slid 0.65 percent and the Nasdaq fell 0.55 percent.Despite months of volatile trading that has seen stocks surge and then backslide, the indexes are going into the final trading session of 2007 with decent gains: The Dow is up 902.72, or 7.24 percent, while the S&P 500 is up 60.19, or 4.24 percent and the Nasdaq is up 259.17, or 10.73 percent.This week saw the kind of choppy trading that is now typical in the stock market. Wall Street was lifted Monday by news of a $6.2 billion in Merrill Lynch & Co., a welcome development given the financial sector's continuing problems from the mortgage and credit crisis. But by Thursday, those gains were gone, wiped out as world political events reminded investors of the problems that still exist beyond the economic uncertainties in the U.S.Advancing issues narrowly outnumbered decliners on the New York Stock Exchange. Consolidated volume came to 2.31 billion shares, up from 2.27 billion shares Thursday.Bond prices rose sharply as investors looked for the assurances of U.S.-backed investments. The yield on the 10-year Treasury note, which moves opposite its price, fell to 4.12 percent from 4.19 percent late Thursday. The dollar was lower against most other major currencies, while gold prices rose.Light, sweet crude fell 62 cents to settle at $96 per barrel on the New York Mercantile Exchange. Rising prices in recent days have renewed talk of breaching the psychological benchmark of $100. Oil hit a peak of $99.29 on Nov. 21.Friday's economic readings painted a mixed picture, lending little help to stocks, which have been unable to carry out an end-of-the-year rally due to concerns that the economy will start contracting.The pace of sales of new homes in November proved much weaker than economists had been expecting. Wall Street had predicted sales would drop about 1.8 percent to a pace of 715,000.In a more optimistic sign for the economy, the purchasing managers index, considered a precursor of the national Institute for Supply Management report being released Wednesday, rose to 56.6 from 52.9 in November. Economists, on average, had been expecting a showing of 52.0, according to Dow Jones Newswires.But the Chicago PMI's December employment index fell to 49.0 from 54.4 in the prior month. Wall Street regards solid employment as the crucial underpinning of the economy's well-being because it feeds consumer spending, which accounts for more than two-thirds of U.S. economic activity.Krosby said the turmoil in Pakistan followin