Stock losses narrow after data

Homebuilder optimism hits a 6-year high, and the US current account trade deficit narrows more than expected. FedEx cuts its full-year outlook. China's territorial dispute with Japan escalates. Apple trades above $700.

By Melly Alazraki Sep 18, 2012 9:29AM
stock market Updated 12:09 p.m. ET

Stocks trimmed earlier losses as investors weighed the significance of economic bellwether FedEx's (FDX) cutting its outlook because of "weak global economic conditions" alongside improved homebuilder sentiment.

The Dow Jones Industrial Average ($INDU) was up 3 points at 13,556. The S&P 500 ($INX) was down 2 points at 1,459. The Nasdaq Composite ($COMPX) was down 2 points at 3,176.

FedEx (FDX) cut its second-quarter and 2013 outlooks because international clients have reduced premium shipping volumes. The package delivery company now projects second-quarter profit of $1.30 to $1.45 a share, which misses Wall Street's forecasts of $1.68 a share on average.

For 2013, FedEx now expects earnings of $6.20 to $6.60 a share, below its earlier forecast of $6.90 to $7.40. Analysts had expected fiscal 2013 earnings of $6.91 a share.

On Monday, U.S. stocks ended lower, breaking a five-day winning streak that took major indexes to multiyear highs last week.
The current account deficit, the broadest measure of international trade in the U.S., shrank 12% to $117.4 billion in the second quarter, the Commerce Department said Tuesday. That is more than the $125 billion deficit economists had expected. A pickup in exports and a bigger income surplus helped narrow the deficit. If the slump in Europe and slowing China growth reduce demand for American goods, this will be hard to sustain.

Homebuilder optimism in September climbed for the fifth straight month to reach the highest level in more than six years, according to the National Association of Home Builders/Wells Fargo. The index gained 3 points to a seasonally adjusted reading of 40, above the 38 reading what economists polled by MarketWatch had anticipated. While the index has been climbing, it still isn't at the 50 level indicating "good" conditions.
 
Dispute between Japan and China escalating
Global stocks also retreated. In Asia, most markets closed lower as investor concern grew about the implications of a territorial dispute between China and Japan. The escalation of the conflict with several Japanese companies, including Nissan  (NSANY) and Panasonic (PC), suspended some manufacturing operations in China as anti-Japan protests spread.

In Europe, markets were generally lower, with investors focusing on a Spanish bill auction to see whether Spain will ask for aid. The Spanish Treasury sold slightly more Treasury bills than planned and paid lower borrowing costs than at the previous auction held a month ago.

Stocks to watch
AMD
(AMD) shares dropped after the the chip-maker said late Monday that Thomas Seifert had resigned as the company's chief financial officer. Devinder Kumar, a corporate controller and a 28-year AMD veteran, will serve as the interim CFO.

Dole Food (DOLE) struck a deal to sell its worldwide packaged-foods unit and its Asian fresh-produce business for nearly $1.69 billion to Japan's Itochu Corp. The proceeds will be used to work to pay down debt as the company also embarks on a streamlining plan via cost-reduction measures.


Alpha Natural Resources (ANR) said it will cut 1,200 employees out of its workforce of 13,100 as part of an effort to save $150 million and scale down its thermal-coal operations. Alpha Natural plans to idle eight mines in Virginia, West Virginia and Pennsylvania.

Kohl's Corp. (KSS) said it will hire more than 52,700 temporary workers to staff department stores, distribution centers and back-office operations for the upcoming holiday season. That represents an increase of more than 10% from last year's holiday hiring.

Apple (AAPL) traded below $700 a share after briefly topping the milestone Monday on news that the company took more than 2 million preorders for the iPhone 5, more than double the initial preorder activity for the iPhone 4S. The new iPhone goes on sale Friday. Analysts at Sterne Agee upped their price target for Apple to $840 a share from $820 a share.
227Comments
Sep 18, 2012 9:47AM
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We now see this Interloper Obama and his cronies are getting paid back in spades by the Muslims of the world for his feigned outrages when accusing people  they don't like of being racist, womenhaters, felons, and you name it.  The Muslims have taken a page right out of Obamas playbook.  This fake outrage over some dumb do nothing video is perfectly suited for a payback the Obama administration rightly deserves.  And whoa they nailed them with it right from the gitgo.  The Obama party line is now that the video has caused the upheavel in the Muslim world.  We know it isn't true, the Muslims know it isn't true, the whole world knows it isn't  true but the Obama  heads have been forced to go along with the lie and the whole world knows it.  How perfectly fitting. Live by the lie, die with the lie.  Law of the jungle. . 
Sep 18, 2012 11:19AM
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Obama prances around telling the poor and uneducated that he is going to help them! LOL Don't you think he would have already done it by now??? He would have given them a job rather than a free check to control them!! So tired of hearing him trying to get popularity votes!! Get real Americans!
Sep 18, 2012 10:05AM
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It would appear that it is getting more and more difficult to prop up that market with printed money.  One up day for $40 billion?  I thought we would get at least a week.  Maybe if BB ups it to $80 billion that will fix it.    

 

 

Sep 18, 2012 10:04AM
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"The Social Security Administration improperly awarded disability benefits in more than 25 percent of cases examined between 2006 and 2010, according to a new Senate report -- potentially costing taxpayers millions of dollars."

"The report also found the agency since January 2009 added 5.9 million Americans to the disability rolls. And in 2011, 10.6 million people were receiving more $128.billion in disability insurance payments, the report said."

What a great way to make the UE rate look better - take almost 6 million people out of the workforce and call them disabled.  Sure, a percentage of these people actually legitimately  qualify, but even if you just take the 1.5 million who don't, and put them back in the "looking for work" category, you end up with an official UE rate pushing 10%.

Sep 18, 2012 10:31AM
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I am so sick of Obama's lies!!!! This economy is in a mess!!!
Sep 18, 2012 10:24AM
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Starting to see more articles on the Fiscal Cliff.  A would not be surprised if we fall over that cliff.  The cliff has already been put in place so all Congress has to do is nothing and we fall over it.   The cuts will have been made and both sides can blame the other for it happening. It's the perfect way to pass unpopular legislation without it sticking to you. 

 

Funny how they can't agree on anything but they were able to agree on what's in the "Cliff".   I call Bull___.

 

 

 

Sep 18, 2012 10:03AM
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Steve, probably the second most important term to a Country's Economy are deficits, incurred in trading Internationally....

Debt may not matter...To some

But Deficits certainly do....And that's part of the slowdown effects in China right now...

No shippy----No money.

Sep 18, 2012 10:40AM
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Disability Awards are/have been a major problem over the last 20 years....

 

After retirement I researched and/or attempted to receive SSI or disability...For back problems, heart situation, and general arthritis..Didn't get a lawyer and finally dropped the claim out of guilt issues.

If I had persued the case, more then likely would have been awarded... But instead just waited till 62 to start collecting SS.

I've known several and do know of,..Many that are collecting, because of bad backs, being fat(obese)

chronic alcoholic or drug abusers,heart problems and mental issues..And a host of other maladies ?

 

Yes,it is a major problem and many of the people could be working...Because some have cash jobs and others are able to function normally, when the MAN isn't looking; Golf,pool,fishing, cutting firewood,farming/gardening,putting on roofs and other odd jobs...

Sep 18, 2012 10:23AM
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The self-described Atlanta-based "oppo researcher" who helped broker the release of the secret video that has rocked the Romney campaign got a congratulatory email today from his famous grandfather -- former President Jimmy Carter. 

If you can't run on your record, you bash the other guy.

Unfortunately what Romney said is probably true.
Sep 18, 2012 10:08AM
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No need to worry..oblamo has been working on a Laser Beam for American jobs...?

Hes been working on it for almost 4 years now.... should see results soon...???

Sep 18, 2012 10:04AM
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NTU, never under estimate the a bull run fueled by money printing.  As long as Helicopter Ben is going to create 40 Billion a month (about $130 / person / month or about 6,200 per family this year), the market will move higher as people try to protect the purchasing power of their savings.

Dump Bonds, CD's and dollars.  Buy Stocks, Specie and other commodities.  Specie and commodities are especially attractive with near zero interest rates.

The flow of capital out of the dollar, should cause economic contraction, and increase job losses.
Sep 18, 2012 10:47AM
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Good thing these message boards are here to keep us all busy all day, cause we know the stock market is being manipulated by the worldwide banking cartel and their "welfare for wallstreet" programs...........hell, if they weren't manipulating it, there wouldn't even be a wall street anymore and all those financial advisers would be on the street looking for real shovel ready jobs.
Sep 18, 2012 11:22AM
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Fed Ex says economy is worsening: Stocks Soar.

Give me a break, Wall Street.
Sep 18, 2012 9:47AM
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Stocks down due to 3 picks by Manning...
Sep 18, 2012 12:14PM
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Americans.......you are not entitled to a free check, you are entitled to be able to have a REAL job!!! Go Romney ,!!!!!!!!!!!!!!!
Sep 18, 2012 9:43AM
Sep 18, 2012 9:52AM
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I suspect we will stumble along for a bit with a gradual drop back to somewhere between 11,500 and 11,800.  JMHO
Sep 18, 2012 12:19PM
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I'm tired of all those whiny, lazy people sitting around on their lazy butts all day doing nothing but complain while waiting for their checks to come in.

 

 

 

 

 

But enough about dividend and capital gains distributions...

Sep 18, 2012 12:17PM
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Nice whitewash article.  Continued lousy economic results but as long as the money machine keeps printing, all is well.  Hope the portion of the 47% that enjoy the handouts (I exclude the honored veterans, and elderly who do fall out of the tax structure) also enjoy higher gas prices and food prices.
Sep 18, 2012 10:35AM
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And now we are back to growth worries!
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