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Today in business: 5 things you need to know
The U.S. economy unexpectedly contracts, RIM renames itself BlackBerry, and more in our roundup of the business stories that are making news and driving opinion
 
The GDP shrank during the fourth quarter, for the first time in more than three years.
The GDP shrank during the fourth quarter, for the first time in more than three years. ThinkStock/Creatas

1. ECONOMY DIPS UNEXPECTEDLY
The U.S. economy shrank in the final quarter of 2012, shocking economists expecting at least modest gains. The Commerce Department reported Wednesday that GDP had contracted by 0.1 percent, the decline was the first since the Great Recession ended three-and-a-half years ago, as President Obama was beginning his first term and the nation was still bleeding jobs. Gross domestic product had risen at a 3.1 percent rate in the third quarter, but the recovery lost steam as federal spending declined by 15 percent, its biggest drop since 1973. Businesses also pared inventories while lawmakers haggled over a deficit-reduction deal. [Wall Street Journal]
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2. RIM RENAMES ITSELF BLACKBERRY
Research in Motion on Wednesday unveiled its first two phones using its new BlackBerry 10 system, which is designed to accommodate increasingly prevalent features such as apps and touchscreens. The company, which is struggling to regain ground after being left in the dust by Apple, Samsung, and other rivals, also announced that it was changing its name to BlackBerry to reinforce its brand. BlackBerry 10 was originally supposed to debut in early 2012, and the delay helped erase $70 billion in shareholder wealth. High hopes drove up the company's stock by more than 5 percent in the hours ahead of the launch. [Wall Street Journal, MarketWatch]
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3. PRIVATE HIRING BEAT EXPECTATIONS
Private employers added 192,000 jobs in January, according to a report released Wednesday by payroll processor ADP National. That beat the expectations of economists surveyed by Reuters, who predicted a gain of 165,000 jobs. The numbers may bode well for the government's more comprehensive employment figures covering both private and government jobs, which comes out Friday. "The job market is slowly, but steadily, improving," said Mark Zandi, chief economist of Moody's Analytics, which collaborates on the ADP report. [Reuters]
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4. AMAZON SHARES SOAR ON RECORD HOLIDAY SALES
Amazon's stock rose by 5.8 percent early Wednesday after shooting higher by 9 percent in after-hours trading, after the giant online retailer reported strong quarterly sales, thanks to robust holiday online shopping. Amazon's profits fell by 45 percent, but that was because the company invested heavily in new distribution centers to please customers with faster deliveries. Operating income, an important measure of business performance, jumped by 56 percent, to $405 million. [USA Today, ABC News]
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5. BOEING LOOKS PAST DREAMLINER TROUBLES
Boeing reported higher-than-expected earnings on Wednesday and forecast "no significant financial impact" from the grounding of its new 787 Dreamliner. Japan's All Nippon Airways had to replace 10 lithium-ion batteries on its Boeing 787 Dreamliners before two battery failures led to the grounding of the world's fleet of the new aircraft this month, according to The New York Times. All Nippon, the world's biggest operator of the new aircraft, notified Boeing. The aircraft maker said Wednesday that the replacements, due to problems such as unusually low charges, didn't pose safety issues or force flights to be delayed or canceled. [CNBC, New York Times, Reuters]

 

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