UNITED STATES

Lenders will have to confirm that a borrower can afford a mortgage before making a loan under protections proposed by the Federal Reserve on Tuesday, following defaults and losses on U.S. subprime mortgages this year.

Gold rallied on Tuesday to close about $800 an ounce on speculation that turmoil in credit markets will force the Federal Reserve to cut interest rates, further boosting the appeal of the precious metal.

Bad news for financial markets isn't over yet and joint central bank action to ease the credit crunch may not be enough to stop a big slowdown in the world economy, Bank of England Governor Mervyn King said on Tuesday.

U.S. lenders would have to determine that a borrower can afford a mortgage before making the loan under a Federal Reserve staff proposal on new regulations released on Tuesday.

Nintendo Co Ltd is having trouble planning for the coming months because of shortages of its Wii video game console, and the company is also seeing signs of higher-than-expected demand for its DS handheld device, a top U.S. executive said on Monday.

Toshiba Corp said on Tuesday it would join a group led by International Business Machines Corp to develop system chips using 32-nanometre circuitry, as chip makers increasingly team up to cut development costs.

Home building projects started in November fell by 3.7 percent as the pace of single-family home construction was the slowest in more than 16 years, a government report on Tuesday showed. The Commerce Department said housing starts fell to an annual rate of 1.187 million units, slightly better than the 1.180 million unit pace Wall Street economists were expecting.

Secretary of State Condoleezza Rice urged Iraqi leaders on Tuesday to speed up national reconciliation on a trip overshadowed by an incursion by several hundred Turkish troops into northern Iraq.

In November, AT&T CEO Randall Stephenson has made an announcement that the company, along with Apple, will release a new, faster iPhone next year, though the comments were never confirmed by Apple.

A new Goldman Sachs Group stock hedge fund could be launched with ore than $6 billion, with some investors expecting the fund to attract as much $10 billion, people familiar with the fund said. Goldman has been raising money and preparing to launch its latest fund for the past few months.

U.S. stocks fell on Monday, as investor grew concerned over rising inflation, sending shares of Exxon and Caterpillar lower.

Gold futures fell to a two-week low on Monday after the dollar rose against the Euro causing the precious metal to lose appeal for investors.

A snowstorm that blanketed parts of the Midwestern United States barreled into New England on Sunday, bringing snow, freezing rain and high winds that grounded flights and made driving treacherous.

Ford Motor Co. is set to choose a frontrunner to buy European brands Jaguar and Land Rover around the end of this week as it moves towards a sale early in 2008, said a person close to the matter on Monday.

European stocks on Monday recorded a sharp decline and closed at their lowest in three weeks amid concerns of inflation effects on global markets and expectations of further rate cuts in the United States.

Home builder sentiment held at a record low for a third consecutive month in December, weighed down by problems in the mortgage market and a huge supply of unsold houses, the National Association of Home Builders on Monday. On Tuesday, investors will get more insight into the hard-hit U.S. housing market when the Commerce Department releases November data on housing starts and building permits.

The European Commission dealt a blow to European online gaming companies on Monday when it accepted a U.S. offer of openings in other sectors to compensate for closing the U.S. gambling market to foreign firms.

After years of modest results, the digital marketplace in 2007 finally began to yield considerable revenue streams for Latin labels and acts.

Iraq will need foreign troops to help defend it for another 10 years, but will not accept U.S. bases indefinitely, government spokesman Ali al-Dabbagh said.

Russia has delivered the first shipment of nuclear fuel to Iran's Bushehr atomic power station, a step Western powers worried by Tehran's nuclear ambitions had urged Moscow not to take.

Aon Corp, one of the world's largest insurance brokers, said on Monday it has agreed to sell two units for about $2.75 billion and will use the proceeds to buy back shares.