UPI NewsTrack Business Share This: UPI 2/7/2013 11:48:58 PM Markets close lower NEW YORK, Feb. 7 (UPI) -- U.S. markets dropped Thursday following declines in Asia and Europe and a report that showed U.S. unemployment benefit claims higher than expected. The Labor Department said initial filings for unemployment benefits dropped by 5,000 to 366,000. But that was less than half the decline economists had predicted. By close of trading, the Dow Jones industrial average lost 42.47 points or 0.3 percent to 13,944.05. The Nasdaq composite index lost 3.34 points or 0.11 percent to 3,165.13. The Standard & Poor's 500 shed 2.73 points or 0.18 percent to 1,509.39. On the New York Stock Exchange, 1,296 stocks advanced and 1,726 declined on a volume of 3.5 billion shares traded. The 10-year treasury note rose 2/32 to yield 1.957 percent. Against the dollar, the euro fell to $1.3396 from Wednesday's $1.3523. The dollar was unchanged on the day against the yen at 93.64 yen. In Tokyo, the Nikkei 225 index dropped 106.68 points, 0.93 percent, to 11,357.07. In London, the FTSE 100 index shed 1.06 percent, 66.92, to 6,228.42. American-US Airways merger nearly complete FORT WORTH, Texas, Feb. 7 (UPI) -- American Airlines and US Airways were tying up final details on a merger that would create the world's largest airline, people close to the negotiations said. Dallas-area newspapers and a Dallas TV station said the merger could be announced as early as next week. The Wall Street Journal said it could take a couple of weeks for an agreement to be completed. The boards of both airlines did not yet announce meetings to consider the all-stock deal, but WFAA-TV, Dallas, reported the board of directors of AMR Corp., American's parent company, planned to meet Monday to consider the combination. Creditors for AMR, which filed for Chapter 11 bankruptcy in November 2011, were expected to own roughly 72 percent of the new airline and US Airways shareholders would own about 28 percent, the Journal said. Both airlines declined to comment. People involved with the talks cautioned the negotiations remained fluid and could still fall apart. Others needing to approve the merger would include creditors, American's bankruptcy judge, the U.S. Justice Department and the European Union, the Journal said. The new company would be based in Fort Worth, Texas, American's home, but be led by US Airways, based in Tempe, Ariz. The combined carrier is expected to retain the American Airlines name. American recently debuted a new logo and paint scheme for its aircraft. The new American would be led by US Airways Chairman and Chief Executive Officer Doug Parker, with AMR CEO Tom Horton becoming non-executive board chairman for at least a limited time, the news organizations said. The Journal said there were some discussions about Horton becoming executive chairman -- a more powerful position. If the deal is reached, the new company could have annual revenue of more than $38.7 billion and more than 100,000 employees, vaulting it ahead of United Continental Holdings Inc. as the biggest U.S. airline by traffic. US Airways hubs in Philadelphia, Charlotte and Phoenix would be combined with American hubs in Dallas, Miami, Chicago, New York and Los Angeles, the Journal said. Increased revenues and cost savings would mainly come from eliminating redundant back-office and operational functions, downsizing US Airways' Tempe headquarters, shrinking management, sharing airport gates and eliminating some aircraft, the Journal said. Diesel cars growing as an option CHICAGO, Feb. 7 (UPI) -- The Chevrolet Cruze Thursday joined the growing ranks of passenger vehicles available with diesel engines for the U.S. market. Diesel vehicles make up 3 percent of U.S. auto sales but Chevrolet's Cruze, to be launched at the Chicago Auto Show this week, joins Volkswagen, Audi, Mercedes Benz, and BMW in manufacturers offering diesel cars for U.S. consumers, the Los Angeles Times reported Thursday. In addition, Jeep, a Chrysler division, and Mazda Motor Corp. have scheduled the launch of new diesel cars this year. Jeep plans to put a diesel engine in a Grand Cherokee sports utility vehicle and Mazda plans to offer a diesel Mazda6 sedan, the newspaper said. Volkswagen has long been ahead of the curve in diesel options. About 20 percent of Volkswagen vehicles sold in the United States have diesel engines. Volkswagen says the more the merrier. "This is not a fixed slice of pie that gets divided by the same customers. This will grow the diesel segment and that's good news for us," Chief Executive Officer of Volkswagen Group of America Jonathan Browning said, referring to the expanding opportunities for consumers to convert to diesel vehicles. Historically, diesel vehicles have been considered slow, smoky, chug-along vehicles that require more expensive fuel. Largely, the price of fuel is affected by higher federal taxes that the government uses to offset the extra wear on U.S. highways by large trucks, which use diesel engines. On the positive side, however, diesel vehicles are known for higher gas mileage and engines last longer than gasoline engines. Diesel cars also retain value better than cars with gasoline engines. Three years out of a showroom, a diesel vehicle averages a resale value 63 percent of the sticker price. For cars with gasoline engines, that drops to 53 percent, consulting firm ALG said. Consumer credit rose in fourth quarter WASHINGTON, Feb. 7 (UPI) -- Consumer borrowing rose in the fourth quarter although credit card debt was little changed, the U.S. Federal Reserve said Thursday. The Fed said total borrowing rose 6.5 percent on a seasonally adjusted annual rate with non-revolving credit -- which includes auto loans, personal loans and student loans -- up 9.4 percent and revolving credit up 0.1 percent. The fourth quarter ended with total consumer debt at $2.747 trillion -- $1.928 trillion in non-revolving debt and $849.8 billion in revolving debt. Consumer credit rose at an annual rate of 6.25 percent in December, the Fed said.