Your update of the most important business news from dozens of respected news sources, selected by the editors of BusinessWeek.

Early Edition July 29 2008 at 04:25 AM Chi-Chu Tschang and Harry Maurer

Russo Out at Alcatel-Lucent After Latest Loss

Pat Russo, the CEO of Alcatel-Lucent, announced her resignation on Tuesday after the telecom equipment company reported a worse-than-expected quarterly loss of 1.1 billion euros ($1.73 billion), its sixth in a row. Slumping demand for its CDMA cellular equipment contributed to the loss. Russo will depart by the end of the year.

The company also announced the resignation of Chairman Serge Tchuruk, like Russo an architect of Alcatel's 2006 takeover of Lucent.

Source: Bloomberg

The Nano: Tata's Costly Promise

India's Tata Motors won kudos early this year when it unveiled its Nano, a car that would sell for just $2,500. But Tata, expected to report a big quarterly loss tomorrow, is being hurt by rising prices for steel and other raw materials. With the Nano's October launch now just a few months away, investors fear that eking out a profit on the Nano will be far harder than earlier hoped.

Source: BusinessWeek

Palestinian Authority on Brink of Bankruptcy

The U.S.-backed government of Palestinian President Mahmoud Abbas is unable to pay July salaries for 150,000 civil servants and may close several institutions because donor nations have not followed through with pledges of support. Palestinian Authority officials say donors have paid only 35% of the amount promised.

Source: Jerusalem Post

Weak Cellular Sales Send Sony Profit Down 47%

Sony's quarterly profits tumbled 47%, to 35 billion yen ($325 million) on weak demand for Sony Ericsson phones. The company also revised downward its forecast for full-year profits 17%, to 240 billion yen ($2.32 billion).

Source: Financial Times

Merrill to Raise $8.5 Billion by Issuing New Shares

In its latest bid to cope with the subprime crisis, Merrill Lynch announced plans to write down $5.7 billion for the third quarter and raise $8.5 billion in fresh capital. Singapore's state-owned investment company, Temasek Holdings, will increase its Merrill stake with an investment of $3.4 billion.

Source: New York Times

'Dark Knight' May Near 'Titanic' Box-Office Record

After pulling in $300 million in just ten days, "The Dark Knight" is on track to become the second-biggest movie ever, passing the $461 million of 1977's "Star Wars Episode IV: A New Hope." Industry experts believe that the all-time champ, "Titanic" ($600.8 million) is safe for now but they expect the Batman sequel to top $500 million at the box office.

Source: Los Angeles Times

Mervyn's Close to Bankruptcy

Department-store owner Mervyn's, which has 177 stores, is on the verge of bankruptcy after declines in sales in California and Arizona. Unless there's a last-minute injection of cash, the retailer will file for bankruptcy protection in the coming days.

Source: Wall Street Journal

Oracle Broadens Allegations Against SAP

The fight between Oracle and SAP got uglier on Monday, with the American company amending a lawsuit originally launched last year against its German rival. Oracle alleges SAP executives were aware of illegal downloading of Oracle software and documents during SAP's acquisition of TomorrowNow, a support and maintenance company.

Source: CNet

U.S. Fight with China, India Threatens Trade Deal

A dispute over cotton and soybeans between the U.S. on one side and China and India on the other threatens to derail WTO talks underway in Geneva aimed at concluding the Doha round, now in its seventh year.

Source: Times of London

Conversation of the Day: IT Under Fire

Reader Heather Purifoy writes: "Next time you want to complain about IT, just remember: We know your password...and how to change it!"

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