My finance view

Toll Brothers Inc. says its fiscal fourth-quarter net income slid 70 percent, partly because last year’s quarter was helped by a large tax benefit.

Still, the performance topped analysts’ expectations, and the luxury homebuilder’s revenue climbed as home deliveries and net signed contracts increased.

Toll Brothers reported Tuesday that it earned $15 million, or 9 cents per share, for the three months ended Oct. 31. That compares with net income of $50.5 million, or 30 cents per share, a year earlier.

Last year’s results included a $59 payday loans with no fax.9 million tax benefit.

Analysts expected earnings of 5 cents per share.

Revenue rose 6 percent to $427.8 million. That beat Wall Street’s $424.3 million estimate.

Home deliveries climbed 8 percent. Signed contracts increased 15 percent.

Toll Brothers is based in Horsham, Pa.

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Airbus on Monday fattened an order for its new A320neo jets and Boeing snagged another customer for the 787 at the Dubai Airshow as Mideast buyers showed they remain bullish despite the uncertain global economy.

The deals, which followed a record $18 billion airplane order from Dubai airline Emirates the day before, added ammunition to forecasts from the two major aircraft manufacturers that predicted the region will continue to generate hundreds of billions of dollars in demand for new planes for years to come.

European manufacturer Airbus predicted Monday that the Middle East will require some 1,920 new planes worth more than $347 billion through 2030. It estimates Mideast passenger numbers will grow 6.4 percent annually _ well above the predicted world average increase of 4.8 percent.

Boeing thinks the potential market is even bigger. Its own forecast, released shortly after its rival’s, puts Mideast demand at 2,520 planes worth $450 billion by the end of next decade.

Much of the growth is driven by fast-growing Gulf airlines, which have boomed in recent years by funneling long-haul travelers through expanding global hubs like Dubai and the Qatari capital Doha.

In terms of deals, Airbus scored the biggest prize of the day, boosting an existing commitment from Kuwait’s Aviation Lease and Finance Co. for the A320neo to 50 planes. The leasing firm, known as ALAFCO, also took options to buy another 30 of the planes.

The deal extends an initial agreement signed by ALAFCO at this summer’s Paris Le Bourget show, when it agreed to buy 30 of the narrow-body planes.

The A320neo offers a new engine option and other features designed to use 15 percent less fuel than older models of the single-aisle A320. It is scheduled to enter service in 2015.

The deal, before options, is worth about $4.6 billion at list prices, though buyers typically negotiate discounts.

Leasing companies like ALAFCO rent out planes to airlines, so the carriers don’t have to assume the costs and risks of owning all the planes in their fleets. It leases planes mainly to regional airlines in the Middle East and Asia.

Boeing Co., meanwhile, picked up a new regional customer for its much-hyped 787.

It and Oman Air said the carrier ordered six Boeing 787-8 aircraft, though the twin-engine planes won’t translate into additional business for the Chicago-based plane maker. That’s because Oman Air is taking over orders previously placed by ALAFCO.

Each 787-8 costs $193.5 million at list prices.

ALAFCO Chairman Ahmed al-Zabin said the decision to shift the 787 orders to Oman Air represented an extension of the company’s view that it is a “strategic partner” for Boeing in the region. It previously announced plans to lease the planes to the Omani carrier.

“Whatever is good for us and Boeing and the customer, we just do it, and that’s what you’re seeing,” he said when asked about the Oman Air deal.

Japan’s All Nippon Airways operated the first commercial flight of the 787 late last month following a series of manufacturing delays. The plane is made of lightweight composite materials and promises to be 20 percent more fuel-efficient than similar planes.

Long lines of curious spectators have lined up in Dubai to step aboard a 787 display model, which is making its debut at the Mideast airshow.

Oman Air is the flagship carrier of the Sultanate of Oman, located on the southeastern tip of the Arabian Peninsula. The airline, set up in 1993, is far smaller than Gulf behemoths such as Dubai’s Emirates and Qatar Airways.

Qatar Airways is among the regional carriers that have already signed up for the Dreamliner. It has ordered 30 of the planes and has options for 30 more. The carrier is expected to announce additional aircraft orders at this week’s show.

Its Dubai-based rival Emirates, the region’s biggest carrier, on Sunday placed an unexpectedly large order for 50 more Boeing 777s, signaling it remains optimistic about its ambitious growth plans despite the shaky global economy.

Boeing said the deal, worth $18 billion at list prices, was its biggest-ever single order by value.

In an interview Monday, Emirates airline President Tim Clark said the carrier would have “no problem” filling those new planes and the nearly 190 other aircraft it has ordered. It helps that the latest batch of 777s won’t begin to be delivered until 2015, giving the world economy time to recover.

“We’ve always been fairly bullish, and that is reflected in the size of the order and the value of the order. We’ve always taken a long-term view in regards to what is happening in the global economy. And we still take that view,” Clark said.

Clark said Emirates needs the extra planes to keep up with passenger demand and cope with marathon flights that can last more than 14 hours, as it pursues its strategy of linking far-flung cities through Dubai.

The carrier is increasingly focusing on emerging markets in Asia, Africa and Latin America, which Clark said older airlines have long shied away from. Over time, he expects bilateral ties between those regions to grow, producing even more business for carriers like Emirates.

At the same time, Clark said Emirates plans to expand its presence in Europe and the U.S. even further. The carrier already flies to Los Angeles, San Francisco, New York and Houston, and it recently announced plans to add service to Dallas and Seattle.

Other cities on Emirates’ radar for possible future expansion are Chicago, Washington, Detroit and Atlanta, Clark said.

“There’s more coming,” he noted. “It’s just a question of timing.”

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It was a passengers’ nightmare at Bradley International Airport in Hartford, Conn., this weekend.

Passengers on three JetBlue planes and one American Airline plane say they were stranded on the tarmac for seven hours or more after being diverted from New York-area airports.

The ordeal continued after they were let off and had to spend the night on cots and chairs in the terminal.

A passenger on one of the diverted JetBlue planes says the crew ran out of snacks and bottled water for the last few hours of the delay.

“The toilets were backed up. When you flushed, nothing would happen,” said Andrew Carter, a reporter for the Sun Sentinel of Florida, who was traveling to cover the Miami Dolphins game against the New York Giants. His plane took off from Fort Lauderdale for Newark Liberty International Airport at around 9 a.m. After being diverted to Hartford, the plane sat on the tarmac between around 1:30 p.m. and 9 p.m., he said.

A representative for Bradley International was not available to comment on the scope of the tarmac delays at the airport.

A JetBlue spokeswoman, Victoria Lucia, confirmed in an emailed statement that six of its planes, carrying a total of about 700 passengers, were diverted to Hartford as a result of a “confluence of events” including equipment failures at Newark and New York’s John F. Kennedy International Airport that prevented planes from landing in low visibility.

She declined to specify how long the planes sat on the tarmac at Bradley, but noted that 17 other flights with different carriers were also diverted to airport.

Once the planes landed at Bradley, Lucia said that intermittent power outages at the airport made refueling and deplaning difficult.

Kate Hanni, executive editor for FlyersRights.org, said she got calls and emails from passengers and worried family members regarding at least four flights that were stranded on the tarmac for up to 10 hours.

Brent Stanley and his wife were on one of those planes, an American Airlines flight that had originally been headed to JFK after taking off from Charles de Gaulle airport in Paris.

After being diverted and landing in Hartford at 2:30 p.m., Stanley said passengers were given various reasons for being held on the tarmac, including the need to refuel and de-ice and the airport’s limited capacity for handling international flights. He and his wife were eager to get back home to their two young sons in Lake Zurich, Ill. But they realized they didn’t have it as bad as the parents who had infants on the plane.

“There was a lady in front of us with an 18-month-old daughter,” Stanley said. “Another woman came by to borrow diapers because we couldn’t get to our luggage.”

After spending the night at the airport, Stanley was lucky to find two seats Sunday on an afternoon flight home to Chicago. But the headache isn’t over yet; his luggage was headed to JFK because the Hartford airport crew wasn’t able to handle international luggage, he said.

An American Airlines spokesman, Ed Martelle, said the passengers weren’t allowed off the plane by customs at the airport. Martelle did not know the exact number of American planes that were diverted to Bradley or how long they sat on the tarmac personal business card.

Matt Shellenberger, who was on a JetBlue flight from Boston to JFK, said his plane was diverted to Bradley International and sat on the tarmac for seven hours.

The crew picked up trash regularly and handed out water and snacks and “everyone held their cool,” he said. But his frustrations grew with each status update; the reasons for the delay kept changing as the hours passed.

Early on, passengers were told that the plane was just being refueled and would fly out soon, Shellenberger said. Then they were told it was being de-iced. Then there was an emergency on another plane.

“We were told we were the third plane in line to get to the gate when we landed,” he said. “Then we stayed on the plane for seven hours.”

Carter of the Sun Sentinel, who was on another JetBlue flight, reported a similar sequence of updates.

The saga continued long after passengers were let off the plane.

The power outages from storms throughout Connecticut made booking hotel rooms difficult. As a result, many passengers just slept at the airport, Carter and Shellenberger said in separate interviews.

When they awoke, hundreds of passengers had to wait in line for hours just to figure out which flight they’d be on.

“That was most disappointing part,” Carter said. “It seemed like there was no plan when we got off the plane.”

In the morning, Carter said he and several other passengers rented a van to drive to New Jersey rather than wait for the afternoon flight JetBlue had scheduled to Newark.

It’s not the first time JetBlue has had problems with tarmac delays. The New York-based airline also made headlines in 2007 when snow and ice storms stranded its planes for nearly 11 hours at New York’s John F. Kennedy International Airport.

Such high-profile delays helped prompt a regulation last year that fines airlines for holding domestic flights on the tarmac for more than three hours. This year, the rule was extended to apply to international flights that are held on the tarmac for more than four hours.

The Department of Transportation often doesn’t enforce the fines to their full extent unless delays are extreme, however. Passengers also do not get a cut of the fines.

Low-cost carriers are more prone to tarmac delays because letting passengers off planes can cost an airline a lot of money, said Hanni of FlyersRights.org.

If a plane is diverted because of a reason within the airline’s control, such as a mechanical failure, ticket contracts usually state that passengers will be reimbursed for hotels, food and transportation. That means airlines do everything in their power to keep passengers on board in hope that the plane will be able to take off again.

JetBlue said that passengers who were diverted to Bradley International would be reimbursed for their fares and hotel expenses.

A representative for the Port Authority of New York & New Jersey, which oversees Newark and JFK airports, could not immediately say how many total flights were diverted to other airports because of equipment failures.

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St. Louis-based Ralcorp Holdings has rejected ConAgra Foods’ offer to buy the company.

Ralcorp issued a statement Monday morning saying the company intends to move forward with its plans to spin off its branded food business, Post Foods, as a separate public company rather than sell the entire company to Omaha, Neb.-based ConAgra. ConAgra’s earlier offers to buy Ralcorp this year so far have been rejected.

Last week, ConAgra issued a statement saying it would retract its offer to buy Ralcorp for $94 a share, or nearly $5.2 billion, by today unless Ralcorp entered into negotiations for a sale. So far, Ralcorp’s board of directors has refused to meet with ConAgra executives about a sale fast payday loans.

“Post Foods is on track to be spun off to Ralcorp shareholders, at which time I will become chairman of the board of the new Post Foods,” Ralcorp Chairman Bill Stiritz said in a statement today. “Post Foods’ main asset is its great brand name — it has untapped potential. Looking forward, the management of this valuable asset will not be a combination of the past, but rather it will be creative, imaginative and adaptive in pursuit of shareholder value creation — nothing is off the table.”

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Revolutionary fighters struggled to make gains in an assault into Gadhafi’s hometown Saturday with bloody street-by-street battles against loyalist forces fiercely defending the most symbolic of the shattered regime’s remaining strongholds.

The fresh attack into the Mediterranean coastal city of Sirte contrasted with a stalemate in the mountain enclave of Bani Walid where demoralized anti-Gadhafi forces tried to regroup after being beaten back by loyalist snipers and gunners holding strategic high ground.

Intense resistance has stalled forces of Libya’s new leadership trying to crush the dug-in fighters loyal to Gadhafi, weeks after the former rebels swept into Tripoli on Aug. 21 and pushed the country’s leader out of power and into hiding. Sirte and Bani Walid are the main bastions of backers of the old regime in Libya’s coastal plain, but smaller holdouts remain in the deserts of the center of the country _ and another major stronghold, Sabha, lies in the deep south.

The resistance has raised fears of a protracted insurgency of the sort that has played out in Iraq and Afghanistan, even as the transitional government tries to establish its authority and move toward eventual elections.

A military spokesman for the transitional government said revolutionaries do not know Gadhafi’s location.

Col. Ahmed Omar Bani pointed to the still uncollected bounty of nearly $2 million that the new leadership has put on the fugitive leader’s head, saying, “Up to now we don’t have any certain information or intelligence about his whereabouts.”

Columns of black smoke rose over Sirte, as revolutionary fighters backed by heavy machine guns and rockets tried to push through crowded residential areas in the city. They claimed to have gained less than a mile into the city, along the main coastal highway leading in from the west.

The forces were met by a rain of gunfire , rockets and mortars. A field hospital set up outside Sirte at a gas station filled with wounded fighters, including some from a convoy hit by a rocket-propelled grenade. Twenty-four anti-Gadhafi fighters were killed and 54 wouneed in the day’s battles, the military council from the nearby city of Misrata reported.

The pro-regime radio station in Sirte repeatedly aired a recorded message it said was from Gadhafi, urging the city’s defenders to fight on. “You must resist fiercely. You must kick them out of Sirte,” the voice said. “If they get inside Sirte, they are going to rape the women.” The voice resembled Gadhafi’s but its authenticity could not be confirmed.

Gadhafi’s spokesman, Moussa Ibrahim, vowed, “We have the ability to continue this resistance for months,” in a phone call Friday to Syrian-based Al-Rai TV, which has become the mouthpiece for the former regime.

The conditions inside Sirte were reportedly growing increasingly dire for those caught in the crossfire. Nouri Abu Bakr, a 42-year-old teacher fleeing the city, said there is no electricity or medicine and food supplies are nearly exhausted.

“Gadhafi gave all the people weapons, but those fighting are the Gadhafi brigade of loyalists,” he said.

Hassan Dourai, Sirte representative in the new government’s interim government, said fighters reported seeing one of Gadhafi’s son, Muatassim, shortly before the offensives began Friday, but he has not been spotted since the battles intensified. The whereabouts of Gadhafi and several of his sons remain unknown. Other family members have fled to neighboring Algeria and Niger.

Most of the hundreds of fighters assaulting Sirte are from Misrata, a city to the northwest along the coast that held out for weeks against a brutal Gadhafi siege during the civil war. Revolutionary commanders were trying to open a second front into Sirte, from the east. They said they were trying to reach a surrender deal with elders in most of the Harawa region, about 50 miles (80 kilometers) east of Sirte, to open a possible new pathway _ but fighting was reported in the area Saturday, suggesting efforts were stalled.

The other stronghold of Bani Walid, 150 miles (250 kilometers) east of Sirte, has proven even more difficult for the forces of the new regime. The fighters withdrew Friday after facing withering sniper fire and shelling from loyalist units.

The loyalists hold the strategic high ground along the ridges overlooking a desert valley called Wadi Zeitoun that divides the city between northern and southern sections. From there, they could bloody the fighters trying to move down through the northern half of the city and into the valley, which is irrigated with olive groves. The terrain has made the city a historical hold-out: In the early 20th century, Italian forces occupying Libya struggled to take Bani Walid.

“This may be the worst front Libya will see,” said fighter Osama Al-Fassi, who joined other former rebels gathered at a feed factory outside the city’s northern edge, where they drank coffee and took target practice at plastic bottles.

On Saturday evening, Gadhafi forces blasted fighters at the northern entrance with snipers and mortar fire, prompting the revolutionary forces to battle their way in once again in an unplanned advance, said Bilqassim el-Imami, one of the fighters. They made their way back to the edge of Wadi Zeitoun amid heavy fire with anti-aircraft machine guns.

A 50-year-old civil servant fleeing Bani Walild with his family, Ismail Mohammed, described the pro-Gadhafi forces as “too strong” inside Bani Walid and suggested a generational divide between young people strongly behind the uprising and older Libyans often more cautious about whether the revolutionary forces can bring stability.

“The youth wanted this revolution and sometimes you can’t control your own son,” he said.

In Libya’s southern desert, hundreds of revolutionary fighters were negotiating with villagers in the still pro-Gadhafi region to surrender peacefully. The fighters left the captured Bani Jalloud air base and rolled through villages where they reached truces. Along the route, crowds cheered their arrival and flashed V-for-victory signs. But in one village, Ayoun, they came under fire, prompting a heavy gunbattle in which one fighter was killed.

Col. Bashir Awidat said they seek to secure the surrounding hinterlands before moving against Sabha, the main southern urban center about 400 miles (650 kilometers) south of Tripoli. He said the villagers had been isolated and believed Gadhafi’s propaganda.

“They think that we’ll raid their houses and rob them. The media coverage here has been bad for 42 years and it has trained people to think a certain way, and that will take time to change,” he told The Associated Press at the captured air base.

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President Barack Obama is previewing his ideas for job creation and economic growth at a Labor Day rally with union members in Detroit.

Obama’s speech at the annual event sponsored by the Metropolitan Detroit AFL-CIO was serving as a dress rehearsal for the jobs address he’s delivering to a joint session of Congress on Thursday night. He arrived in Michigan mid-day.

The president’s appearance follows last Friday’s dismal jobs report, which showed that employers added no jobs in August. It was the first time since 1945 that the government reported a net job change of zero. The unemployment rate, meanwhile, held steady at 9.1 percent.

The disappointing report sparked new fears of a second recession and injected fresh urgency into efforts by Obama to help get millions of unemployed people back into the labor market _ and help improve his re-election chances.

Polls show the economy and jobs are the public’s top concerns. Public approval of Obama’s handling of the economy hit a new low of 26 percent in a recent Gallup survey.

The unemployment report also gave Obama’s Republican critics, including those who want to challenge him in next year’s presidential election, fresh ammunition to pound him with.

GOP presidential candidate Mitt Romney called the report disappointing, unacceptable and “further proof that President Obama has failed.” Romney is scheduled to outline his own job-creation plan in a speech Tuesday in the battleground state of Nevada.

In the speech to Congress, Obama is expected to call for a mix of individual and business tax credits and public works spending. He will also press lawmakers for swift action on those proposals.

The day after his address to Congress, Obama plans to visit Richmond, Va. _ part of which is represented by House Majority Leader Eric Cantor, R-Va., one of the president’s fiercest critics. Obama plans to spend a “decent amount of time” traveling the country to encourage support for his job creation plan, said deputy White House press secretary Josh Earnest.

“These are bipartisan ideas that ought to be the kind of proposals that everybody can get behind, no matter what your political affiliation might be,” Obama said last week. “So my hope and expectation is that we can put country before party and get something done for the American people.”

Labor Secretary Hilda Solis said Monday that both political parties should get behind Obama’s efforts to improve the hiring picture.

“We do need everyone to be on board,” she said on NBC’s “Today” show.

Solis said Obama “is very mindful of what the needs and concerns are of those individuals who have been out of work for so long.” But she also said the jobless have a responsibility to seek training in new skills, if necessary, to better prepare themselves for the kinds of jobs available in today’s economy.

Obama spent part of the holiday weekend at the Camp David presidential retreat in Maryland “putting the finishing touches” on the proposals and the speech, said spokesman Jay Carney.

“That process continues over the next few days, but he’s very far along,” Carney said.

In Detroit on Monday, Obama was also expected to tout his efforts to save the auto industry and millions of jobs by providing federal bailouts in 2009 for General Motors Corp. and Chrysler Group LLC. The AFL-CIO rally was being held in a GM parking lot.

Obama won Michigan in the 2008 presidential election and the economically challenged state is crucial to his re-election prospects. The state unemployment rate was 10.9 percent in July, above the national average for that month. The Detroit-area jobless rate was even higher, at 14.1 percent in July.

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The wars in Iraq and Afghanistan are winding down, Osama bin Laden is dead, and the federal government is deeply in debt. This spells the end of what was a golden decade for the defense industry.

In the decade since the Sept. 11 attacks, the annual defense budget has more than doubled to $700 billion and annual defense industry profits have nearly quadrupled, approaching $25 billion last year.

Now defense spending is poised to retreat, and so are industry profits. “We’re about to go into the downhill side of the roller coaster here,” said David Berteau, a defense industry analyst at the Center for Strategic and International Studies.

Congress agreed last month to cut military spending by $350 billion over the next 10 years. The defense budget will automatically be cut by another $500 billion over that period if lawmakers fail to reach a deficit-cutting deal by November.

Defense industry stocks have already begun to suffer; they are lagging the S&P 500 in recent months. During the last defense spending downturn, which lasted from 1985 to 1997, defense stocks underperformed the broader market by 33 percent, according to an analysis by RBC Capital Markets.

The Sept. 11 attacks forced the world’s biggest and best-funded military to quickly retool itself. It needed to develop technologies, weapons and strategies to find and fight an elusive network of terrorists that seemed more sophisticated and dangerous than ever imagined.

The U.S. spent $1.3 trillion in the ten years following the attacks chasing al-Qaida and fighting two wars. That was on top of baseline military spending in excess of $4 trillion.

“After 9/11 the floodgates opened,” says Eric Hugel, a defense industry analyst at Stephens Inc.

The defense budget grew from $316 billion in 2001 to $708 billion in 2011. Federal spending on homeland security, which includes everything from airport security to border control, also rose dramatically. Last year dozens of federal agencies, including the Department of Homeland Security, spent $70 billion on such programs, according to the Office of Management and Budget. That’s up from $37 billion in 2003, the first year after DHS was formed.

All that spending was reflected in the soaring performance of the defense industry, led by the top five defense contractors: Lockheed Martin, Boeing, Northrop Grumman, General Dynamics and Raytheon.

In 2001, revenues for U.S.-based defense contractors totaled $217 billion, according to data compiled by the analytics firm Capital IQ. By 2010 revenues had grown to $386 billion. Profits grew more than twice as fast over the same time period, from $6.7 billion to $24.8 billion. Contractors based abroad, such as BAE Systems, also flourished. BAE was the sixth biggest defense contractor in 2010, with $7.2 billion in U.S. military contracts.

Stock prices of defense companies in the S&P 500 index have risen 67 percent since September 11. The index as a whole climbed 8 percent in that period.

Military spending typically rises during wartime and falls during peacetime. But after Sept. 11, and as the wars in Iraq and Afghanistan evolved, it became clear the country needed to spend money on very different military technologies and strategies.

Fighter jets, missile defenses and other Cold War-era systems designed to deal with the perceived threats of nation-states were less useful. The U.S. military had to increase its ability to find, recognize and track enemies that were scattered in many countries and dispersed among the civilian population same day payday loans.

During the war in Iraq the military realized that it couldn’t protect troops from a low-tech, but potent threat: jerry-rigged road side bombs. In Afghanistan, commanders needed ways to find and root out insurgents that had tucked themselves in caves in hard-to-reach mountains.

These challenges led to new hardware. Among the most important:

_ Transport trucks that protect troops and supplies from roadside bombs. Mine-resistant, ambush-protected vehicles, or MRAPs, quickly became crucial equipment for the Army. Oshkosh Corp., a maker of these trucks, was the 9th biggest military contractor last year. Before 9/11, it wasn’t in the top 20.

_ Identification tools. Soldiers now carry small portable devices that identify a person by scanning fingerprints, irises and faces. These devices, made by L-1 Identity Solutions, which was recently acquired by Safran, can weigh as little as 3 pounds, transmit data by several different wireless methods and remember 1 million identities.

_ Unmanned aircraft. General Atomics’ Predators, drones that can fire missiles, have killed several al-Qaida commanders. Lockheed Martin’s RQ-170 Sentinel reportedly kept watch on Osama bin Laden’s compound as the raid that killed him was taking place.

Another type of company surged in importance in the last decade: Companies that provide services and support to military operations.

As of March, the Defense Department had more contractor personnel in Afghanistan in Iraq than uniformed personnel, according to a study by the Congressional Research Service. Afghanistan has the highest ratio of contractors to military personnel than any other U.S. war.

This has boosted companies like KBR, once a division of Halliburton. KBR, which builds and maintains military bases and other facilities, had $4.7 billion in military contracts in 2010, up from $860 million a decade earlier.

Analysts say the heavy reliance on contractors should allow the military to wind down spending more quickly, because it is easier to terminate a contract than to reduce uniformed troop levels. Also, the government isn’t responsible for pensions, health care and other benefits for contract workers, which should save money.

Equipment spending is already being scaled back. In 2009, funding for the F-22 fighter jet, a $65 billion program, was discontinued. Spending on the F-35 fighter jet is in danger of being cut back. An advanced warship called the DDG1000 has been canceled, and an upgrade to the Bradley tank called the Ground Combat Vehicle may also be scaled back or canceled.

Over the past six months, defense company stocks in the S&P 500 index have fallen 16 percent. That compares with an 11 percent decline for the entire index.

During wartime, when dollars are flowing, the new equipment developed to battle new enemies is used together with the equipment that had been developed for earlier wars. But as budgets shrink this time, some of the technologies that were developed during the past decade, such as the unmanned aircraft, will have to replace older systems entirely.

“The era of manned airplanes should be seen as over,” says Michael O’Hanlon, a defense policy expert at the Brookings Institution. “The problem is nobody wants to give up the previously agreed on platform.”

Jonathan Fahey can be reached at http://www.facebook.com/Fahey.Jonathan

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Moody’s downgraded Cyprus’ credit rating by two notches over concerns about the economic toll of a deadly blast that took out the island nation’s main power station.

As well as cutting its rating on Cyprus from A2 to Baa1, the credit rating agency also slapped a negative outlook on the country Wednesday, meaning that another downgrade may be in the offing.

Moody’s said the destruction of the Vasilikos power plant as a result of a July 11 blast at a nearby naval base has amplified concerns about the fiscal situation in Cyprus, which began using the euro currency in 2008.

As well as killing 13 people, the blast has led to rolling, two-hour power cuts to cope with demand.

“This incident has caused material disruption to the Cypriot medium-term economic and fiscal position,” Moody’s said, adding that it has reduced its growth forecasts for Cyprus to zero percent and one percent in 2011 and 2012 respectively.

Before the blast, the European Commission projected Cyprus’ economy to grow by 1.5 percent this year and 2.4 percent in 2012.

Moody’s also said that an “increasingly fractious political climate” in the wake of the blast raises the risk that planned economic reforms may be watered down or delayed.

Public anger at the government over the blast of dozens of seized containers filled with Iranian munitions has yet to subside. Thousands continue to protest outside the presidential palace, accusing the government of negligence and calling on President Dimitris Christofias to quit.

Some 98 containers, most of them filled with gunpowder, were left stacked in an open field since being seized from a Cypriot-flagged ship in 2009 that the U.N. said breached a ban on Iranian arms exports.

The Cyprus government and opposition leaders agreed last week to cuts cost to buoy the economy in the wake of the blast.

But there is still disagreement on how deep cost cuts should go, especially to the public payroll that takes up about a third of the island’s euro8 billion ($11.58 billion) budget.

Cyprus’ top banker last week warned that the blast may force Cyprus to seek a bailout if deep spending cuts aren’t swiftly made.

Cyprus has pledged to the EU to cut its fiscal deficit which now stands at 5.3 percent to 3 percent of GDP by next year.

Moody’s also said there is a material risk that the Cypriot government may need to prop up some of the island’s banks over the next few years because of their heavy exposure to bailed-out Greece.

“Therefore, a period of prolonged macroeconomic stress would increase the likelihood that these contingent liabilities will crystalize on the Cypriot government’s balance sheet,” said Moody’s.

Moody’s also pointed to the Cypriot banking sector’s large size relative to the economy, as domestic bank assets total 600 percent of the island’s euro17.4 billion ($25.18 billion) gross domestic product. Around 40 percent of the total loans of the island’s three largest domestic banks are to customers based in Greece.

However, Cypriot banks should remain well capitalized over the short term after strengthening their capital reserves over last year.

The agency said it would consider upgrading Cyprus’ credit rating if the government moves ahead with large scale structural reforms. But it warned of additional downgrades if those reforms are watered down or significantly delayed.

Credit rating agencies Fitch and Standard and Poor’s have also downgraded Cyprus in recent months, mainly because of the island’s Greek exposure.

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Missouri’s delicate compromise on economic development incentives got a boost Thursday when Gov. Jay Nixon said he endorsed many of its key elements.

From cargo hub tax credits to a new fund for high-tech startups, Nixon echoed many of the priorities laid out by House and Senate leaders in tax credit legislation they unveiled Wednesday. He called the deal

Stocks were mixed in early trading Wednesday, a day after the Dow Jones industrial average had its biggest gain this year, as traders weighed strong earnings from Apple and a slew of new deals.

Apple Inc. rose 3 percent after the company’s income doubled last quarter, trumping analysts’ estimates, as sales of the company’s iPhones quadrupled in Asia.

American Airlines’ parent company, AMR Corp., rose 2.4 percent after announcing an order for 460 planes from Boeing and Airbus. The new planes are expected to save money on fuel. Rising fuel prices left the airline with a loss of 85 cents a share, larger than analysts expected. The airline also said it would spin off its American Eagle subsidiary.

United Technologies Corp.’s dropped 2 percent in early trading, tugging down the Dow Jones industrial average. Cleaning and pest-control services company Ecolab Inc. said it would buy the water treatment company Nalco Holding Co faxless cash advance. for $5.4 billion. Nalco soared 25 percent while Ecolab dropped more than 7 percent.

The Dow Jones industrial average is down 23 points, or 0.2 percent, to 12,563 in early trading. The S&P 500 index is up less than 1 point to 1,327. The Nasdaq is down 5 points, or 0.3 percent, to 2,820.

Stronger profits from Coca-Cola Co. and IBM Corp. along with apparent progress in raising the U.S. debt limit prompted a stock market rally Tuesday. The Dow gained 202 points, its best day this year.

Tuesday’s rally turned the three major indexes positive for the month. The Dow and Nasdaq are now up more than 1 percent in July. The S&P 500 is up 0.5 percent.

Intel Corp. and American Express Co. are scheduled to report earnings after the market closes.

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