PRESS DIGEST - New York Times business news - May 1

May 1 (Reuters) - The following were the top stories in the New York Times business pages on Thursday. Reuters has not verified these stories and does not vouch for their accuracy.

* On Wednesday, the Commerce Department reported that the economy continued to stagnate during the first three months of the year, with a sharp pullback in consumer spending the primary factor at play.

* The Federal Reserve, mixing concern about the feeble economy with worries about rising inflation, reduced short-term interest rates Wednesday for the seventh time since September, while signaling a pause in any additional rate cuts for now.

* Cablevision Systems Corp (CVC.N) is preparing a $650 million offer for Newsday, $70 million more than bids by Rupert Murdoch and Mortimer Zuckerman, while the owners of The New York Observer have dropped out of the bidding, people briefed on the matter said on Wednesday.

* Kohlberg Kravis Roberts, the giant buyout firm, is planning to announce on Thursday a new partnership with the Environmental Defense Fund, an advocacy group, to help it improve the environmental performance of the dozens of businesses.

* Hewlett-Packard Co (HPQ.N) scientists reported Wednesday in the science journal Nature that they have designed a simple circuit element that they believe will make it possible to build tiny powerful computers that could imitate biological functions.

* Seeking to rein in medical costs, a commission in Michigan on Wednesday moved to prevent hospitals in the state from each spending $100 million or more to provide a new form of radiation treatment for cancer.

* A former chief operating officer at Monster Worldwide Inc (MNST.O), the job recruitment Web site, was indicted Wednesday on charges of securities fraud and conspiracy in connection with what prosecutors said was a scheme to backdate millions of dollars in employee stock option grants.

* Microsoft Corp's (MSFT.O) chief executive, Steven Ballmer, is said to be considering boosting his company's bid to $32 a share, but some at Yahoo Inc (YHOO.O) want more.

* The Federal Deposit Insurance Corp proposed permitting the Treasury Department to lend $50 billion directly to as many as a million homeowners to help ease the housing crisis.

* Canadian federal and provincial government officials were conducting an investigation Wednesday into Syncrude Canada, a large oil-sands project operator, after hundreds of migrating ducks that landed in a company tailings pond died.

* The prime minister of Thailand, Samak Sundaravej, said Wednesday that his government would try to create a cartel of rice-producing countries in partnership with Vietnam, Cambodia, Myanmar and Laos.

* A bargaining group for Hollywood's largest movie and television companies on Wednesday told its members, in effect, not to expect a breakthrough in stalled talks with the Screen Actors Guild before their scheduled end on Friday.