Stocks fall as regional manufacturing slows
The Philadelphia Fed gives a weak report on factory activity. Initial unemployment filings remain unchanged. Facebook's IPO price range is finalized.
Updated at 10:38 a.m. ET
The major averages were slipping Thursday after the Philadelphia Federal Reserve gave a worse-than-expected read on regional manufacturing activity.
Spain raised 2.5 billion euros in a debt auction, but its borrowing costs rose, highlighting worries about the country's economy and raising concerns about Greek debt contagion.
The Dow Jones Industrial Average ($INDU) was down by 25.6 points, or 0.2%, at 12,573 but paring losses. The S&P 500 ($INX) was down by 4 points, or 0.3%, at 1,321. The Nasdaq ($COMPX) was falling by 12.6 points, or 0.4%, to 2,861.
In domestic news, the Philadelphia Federal Reserve said its general economic index fell to minus 5.8 in May from 8.5 in April. It was a big miss, as economists surveyed by Thomson Reuters expected the index to rise to 10.
The Conference Board's report of leading economic indicators for April was also a disappointment. The report showed a decline of 0.1% in April after a gain of 0.3% in March. Economists had forecasts a rise of 0.2% for last month. The Conference Board attributed the drop to rising jobless claims and falling housing prices.
The U.S. Labor Department reported that initial jobless claims were unchanged at a seasonally adjusted 370,000 in the week ended May 12. Economists had forecast a fall to 365,000.
The four-week moving average fell to 375,000 from 379,750 in the previous week.
Continuing claims for the week ended May 5 were 3.265 million, up from the preceding week's level of 3.247 million.
London's FTSE was down 1.5%, and the DAX in Germany was falling 1.2%.
Spain's borrowing costs rose amid fears about the health of its economy and banking system, as well as worries about Greek debt, though its latest debt auction went relatively smoothly, with the country raising its maximum target of 2.5 billion euros ($3.2 billion).
For bonds maturing in January 2015, Spain had to pay an interest rate of 4.373%, up from 2.89% in April. For bonds maturing in April 2016, interest rates rose to 5.106%, up from 3.374% in March.
Spain's gross domestic product shrank by 0.3% during the first quarter, matching its fourth-quarter decline. The final figure matched its preliminary estimate.
"Spain has formally slipped back into recession," Societe Generale analysts said.
Debt contagion fears persisted as the European Central Bank indicated that it will temporarily halt lending to some Greek banks to reduce risk exposure there. ECB President Mario Draghi said in a speech Wednesday in Frankfurt that while the central bank's preference is for Greece to stay in the single-currency bloc, the country might have to break off from it.
Meanwhile, the leftist Syriza coalition, which still dominates the public opinion polls in Greece, remains adamant about loosening the tough austerity measures Greece has had to abide by as part of its European Union and International Monetary Fund bailout deal.
In Asia, the Hang Seng Index in Hong Kong fell 0.3% and Japan's Nikkei average finished up 0.9%.
The benchmark 10-year Treasury was rising 3/32, diluting the yield to 1.754%. The dollar was flat, according to the dollar index.
The June crude oil contract was up 54 cents at $93.35 a barrel. June gold futures were rising $31.10 to $1567.70 an ounce.
In corporate news, CNBC reported that the price range for Facebook's initial public offering has been finalized, citing a source close to the situation. The report says that while Facebook could still price above the expected range, Securities and Exchange Commission regulations forbid companies from pricing too far above what they had disclosed to the public. That means the rule sets a maximum price for Facebook at roughly $45, according to the report.
Wal-Mart Stores (WMT), the world's largest retailer, reported first-quarter earnings of $3.74 billion, or $1.09 a share, up from year-earlier earnings of $3.39 billion, or 97 cents a share. Analysts, on average, were looking for a profit of $1.04 a share in the April-ended period on sales of $110.54 billion. The retailer announced Wednesday that it anticipates second-quarter earnings of between $1.13 and $1.18 a share; analysts are expecting $1.16 a share.
Sears (SHLD) reported first-quarter profit of $189 million, or $1.78 a share, a reversal from a year-earlier loss of $170 million, or $1.58 a share. The latest quarter included about $200 million of gains from the sale of some U.S. and Canadian stores. Sears posted an adjusted first-quarter loss of 31 cents a share, compared with an adjusted year-earlier loss of $1.34 a share. The retailer was expected by analysts to post a quarterly loss of 67 cents a share.
Agilent Technologies (A) announced it is making its largest acquisition to date of Denmark cancer diagnostic firm Dako for $2.2 billion.
Limited Brands (LTD), the specialty retailer, whose brands include Victoria's Secret and Bath & Body Works, said Wednesday it expects second-quarter earnings of 40 cents to 45 cents a share. Analysts polled by Thomson Reuters were looking for a profit of 50 cents a share in the July-ending quarter. For the full year, Limited said it expects earnings of $2.63 to $2.83 a share; Wall Street's current consensus estimate is $2.83 a share.
Its amazing how the market moves up and down with any news on the EU when substantially the Greece and Spain issue just continues to spiral downward. Wishing and Hoping are not a plan, nor is burying your head in the sand.
If the people of a country do not have the will- which is difficult to obtain after years of leadership basically lying to the people- then the problem will not be solved and we can all use their money as heating fuel.
Got a deck to build. Have a great day.
Opportunity rarely comes easy. We have to see it. That requires confidence in ourselves and our abilities, especially to grow and change. Nothing is static. Our bodies. This planet. Everyone and everything is changing all the time. This is life. Tap into this, instead of being afraid of it, work with it, instead of against it. This is were personal power is found.
According to Matthews, Madcow and Ed, everyone wants to know"
1) HOW did Bain become so successful ?
2) Where did the money come from?
3) Where there any illegal activities involved ?
4) How manny people dids Romney fire ?
Matthews was ALL over "vetting" Romney.
Hmm , isn't this more than a little interesting ?
The very same "journalists" 4 years ago:
1) Where was Obama born ? WHO CARES !
2) College Transcripts ? WHO CARES!
3) Why does he have multiple names? WHO CARES !
4) What name did he use in college for admissions ? WHO CARES !
5) Was he a "foreign " student back then in college? WHO CARES!
6) Why does he have 2 Social security Numbers ? WHO CARES !
7) What does his thesis contain? WHO CARES ?
8) What's his involvement with convicted swindler Tony Rezko ? WHO CARES ?
9) Terrorists Bill Ayers and Bernadine Dorns-? WHO CARES ?
10) What are his social views/agenda? WHO CARES?
11) Is he even at least a capitalist? WHO CARES ?
12) What was his record in the Senate ? WHO CARES?
13) Rev Wrong, the American hating racist- 20 year relationship with OB - WHO CARES?
14) Where did Obuma get HIS money? WHO CARES?
15) How did Michele obuma get a cushy job in a legal firm ? WHO CARES ?
16) How much DRUGS did OB really do (he admits it in his masterpiece- Dream of finding Who my Daddy Is) WHO CARES?
17) What's his involvement with super one percenter /commie George Soros ? WHO CARES !
I really don't think , Obuma's getting a free pass this time.
Of course the Commie media (MSN, MSNBC and CNN) will NEVER ask those questions but here's a surprise.
Americans REALLY want to know this time.
It's out there and as long as The MNBC are looking into Romney piehole, it goes both ways.
Gee, I wonder who REALLY has the most to hide?
You gotta love that Trickle down, if you are a 1%'er!
Not so good if you are one of the 99% unemployed and looking for a job!
Everyone knows that we can never have a simplier and fairer tax code. Those that
need to pass that type of legislation are certainly not going to kill THEIR goose
that lays the golden eggs. The current tax code.
Sears (SHLD + 11.07%) reported first-quarter profit of $189 million, or $1.78 a share, a reversal from a year-earlier loss of $170 million, or $1.58 a share. The latest quarter included about $200 million of gains from the sale of some U.S. and Canadian stores. Sears posted an adjusted first-quarter loss of 31 cents a share, compared with an adjusted year-earlier loss of $1.34 a share. The retailer was expected by analysts to post a quarterly loss of 67 cents a share.
Had they not had the $200 million dollar gain from selling off stores they would have lost money. Once again, this chain is heading downhill fast and just like other corporations here in America they continue to sell off assets, cut jobs etc. just to make their quarterly numbers. Key questions to ask Sears....are they increasing their comp stores sales? Are their overall sales and margin increasing? Is there foot traffic increasing? Is there average sales ticket price increasing? This chain is heading no where but down and that's the TRUTH!!
Daily rants about politics, government and the markets. The unfairness of it all. The coulda, woulda, shoulda. But if only such and such would happen, then it will be ok? Welcome to the human condition. Birth/life/death.
Do you really like looking as weak as many of you appear to be here. Is that your only "song and dance" blame, justification, self victimization?
I think you can do better then that?
If "change" is a joke for many of you. Why are you so afraid of it?
BJM Hope you find a good job. If you do not want to work VOTE for obame He is truely clueless
maybe not He and wifey dont like America I forgot
Do Gooder BS Issue Makers will be clamoring for "their" gun and complaining about the cost of Ammunition!
Please keep in mind that if you are stock piling ammunition for your weapons but you are not stock piling food and water you will end up being a problem. Think ahead. .... JMHO
said: Although with government consuming 26% of GDP, would not the tax rate have to be near this level? And with the rate at near this level would not Americans resort to an underground economy?
The rate I have seen in the literature about the Fair tax is around 23%. I thnk that if
the Fair Tax succeeds the government wound no longer need to consume 25% of
What sealed the deal for me about the Fair Tax is what is called the pre-bate. It refunds
each month to every family the tax on the poverty level income based on number of people
in the family. My biggest problem with the Fair Tax was how it would penalize the
lower income people. This aleviated that problem.
Remember it also replaces the SS and MC tax. So people get their whole paycheck
free of all federal taxes. Have a feeling this would end up as the only tax and the states
would share in this revenue as well.
said: And with the rate at near this level would not Americans resort to an underground economy?
There is already and underground ecomony that is not taxed. Gambling, prostitution, and
drugs. But the money from these activities and others will at some point be spent and
subject to the fair tax. I read that the current underground economy may be 10% or more
of the GDP.
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