S&P 500 slips on weak earnings; Dow gains
NEW YORK (AP) — Wall Street's attentions turned away from Europe and to corporate earnings in Wednesday trading. But some disappointments, mostly in technology earnings, weighed on the market.
Stocks closed mixed.
The Dow rose 59 points, or 0.5 percent, to 12,676. The S&P slipped less than a point to 1,338. The slight decline means the S&P has logged a four day losing string.
The Nasdaq fell nearly 9 points to 2,854.
Helping the Dow were big gains from two of its components, Boeing and Caterpillar. The duo contributed 24 points to the index, or nearly half of its gain.
Apple makes up nearly 13 percent of the Nasdaq composite, making it by far the biggest component of the technology-focused index.
The bad news from tech stocks didn't end there. After the closing bell, Zynga, the maker of online video games like "Farmville," slashed its forecast for full-year earnings, blaming delays in launching new games, dwindling revenue from existing web games and a "more challenging environment" on the Facebook platform. The stock plunged $2.04, or 40 percent in after-hours trading.
Asian markets rise, but improvement tempered by concerns about South Korea
BANGKOK (AP) — Asian stock markets rose Thursday amid hopes Europe will give its bailout fund more financial firepower but gains were tempered as South Korea reported its economic growth slowed to a two-year low.
Markets have been rattled over the past few days by fears that Spain, the fourth-largest economy among the 17 states that use the euro, could need a bailout along the lines of Greece, Ireland and Portugal.
Sentiment was given a boost by a suggestion from European Central Bank policymaker Ewald Nowotny that the European Stability Mechanism, the euro area's planned permanent bailout fund, could be given a banking license. That would give it the ability to borrow money from the ECB. Such a move would be of particular significant for Spain and Italy as the current bailout fund does not have enough money to rescue them both.
Jobless claims, pending home sales due
WASHINGTON (AP) — On today's economic calendar, the Labor Department releases weekly jobless claims, while the Commerce Department has durable goods orders for June.
The National Association of Realtors has pending home sales for June. Also, Treasury Secretary Timothy Geithner testifies before the Senate Banking Committee.
Oil prices down after U.S. crude inventories rise
BANGKOK (AP) — Oil prices fell Thursday in Asia after U.S. crude inventories swelled and a slowdown in South Korea's economy underlined that growth in demand for fuel could remain subdued.
Benchmark crude for September delivery was down 48 cents at $88.49 a barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract added 47 cents to settle at $88.97 in New York on Wednesday.
Brent crude was down 52 cents at $103.86 on the ICE futures exchange in London.
A rise in U.S. crude supplies pointed to weak demand as the recovery in the world's No. 1 economy stumbles. The Energy Information Administration reported that the nation's crude supply grew by 2.7 million barrels last week. Analysts were expecting supplies to fall by 250,000 barrels, according to a survey by Platts, the energy-information arm of McGraw Hill.
U.S. crude supplies have grown this year to the highest levels since 1990. Gasoline supplies rose more than expected. The EIA said that gasoline supplies increased by 4.1 million barrels last week. Analysts were expecting supplies to grow by only 750,000 barrels.
NEW YORK (AP) — Facebook today is slated to post its first earnings report as a public company.
At issue is its ability to convince businesses that the ads on its website and on its mobile application are effective. To do that, the world's largest online social network needs to keep its nearly 1 billion users logging on as often — and for as long— as possible, interacting with each other as well as with brands.
The release of its quarterly financial results will be Facebook's chance to prove to investors that it can continue growing revenue from the ads it serves on its wildly popular social networking site.
Analysts are expecting Facebook to post earnings of 12 cents per share on revenue of $1.2 billion. In all of 2011, it had earnings of $1 billion and revenue of $3.7 billion, according to regulatory filings.
The earnings report is due after the stock market closes. It will hold a conference call to discuss the earnings at 5 p.m. ET.
The stock has traded between $25.52 and $45 since going public. It has not risen above $38 since its first trading day.
Democratic-favored tax bill clears Senate
WASHINGTON (AP) — Democrats have pushed a yearlong extension of tax cuts for all but the highest-earning Americans through the Senate, giving President Barack Obama and his party a significant political victory on a measure that is fated to go no further in Congress.
Senators approved the Democratic bill Wednesday by a near party-line 51-48 vote, with Vice President Joe Biden presiding over the chamber in case his vote was needed to break a tie. Minutes earlier, lawmakers voted 54-45 to kill a rival Republican package that would have included the best-off in the tax reductions.
The $250 billion Democratic measure would extend tax cuts in 2013 for millions of Americans that otherwise would expire in January. But it would deny those reductions to the earnings of individuals exceeding $200,000 yearly and of couples surpassing $250,000.
Zynga stock tanks after weak 2Q report
NEW YORK (AP) — Zynga's stock tanked after the online game maker reported a loss in the second quarter, with adjusted earnings and revenue below Wall Street's already-low expectations.
The company behind games such as "CityVille" and "FarmVille" also lowered its outlook for the year because of delayed games, reduced expectations for its "Draw Something" game and what it called a "more challenging environment on the Facebook Web platform."
Zynga derives nearly all of its revenue from games played on Facebook, and a growing number of Facebook users are accessing the social network using mobile devices rather than computers. That hurts Web-based games such as Zynga's.
Zynga said that it lost $22.8 million, or 3 cents per share, in the April-June quarter. That's down from earnings of $1.4 million a year ago when it was still privately held. Its per-share results last year were at breakeven.
Adjusted earnings in the latest quarter were a penny per share, below expectations of 5 cents per share.
Facebook's stock also declined after Zynga's announcement. The bad news from Zynga could hurt Facebook, which reports its earnings on Thursday. Facebook's stock fell $2.54, or 8.7 percent, to $26.80 in after-hours trading.
Wal-Mart sued by disabled over payment machines
SAN FRANCISCO (AP) — Disability rights advocates have filed a federal lawsuit against Wal-Mart. They charge the retail giant refuses to make payment machines accessible to customers who use wheelchairs and scooters.
The plaintiffs allege that Bentonville, Ark.-based Wal-Mart knowingly placed point-of-sale terminals beyond the reach of disabled customers at many of its more than 200 stores in California.
The lack of accessible payment devices makes it difficult for many disabled customers to independently pay for goods with a credit or debit card, according to the lawsuit, which attorneys say is the first of its kind.
Wal-Mart officials did not immediately respond to a request for comment.
The class-action lawsuit was filed in U.S. District Court in San Francisco by the Berkeley-based Center for Independent Living and two disabled individuals. They are represented by the groups Disability Rights Advocates and Disability Rights Education and Defense Fund.
Chicago alderman blocks Chick-fil-A expansion
CHICAGO (AP) — A Chicago alderman says he won't allow Chick-fil-A to open a restaurant in his ward until it comes up with a written anti-discrimination policy.
Before Wednesday's City Council meeting, Alderman Joe Moreno said he's tried to work with the company for months but Chick-fil-A won't put its stated anti-discrimination policy into writing.
The issue came to a head last week after Chick-fil-A President Dan Cathy said he doesn't support same-sex marriage. Chick-fil-A says it has a history of applying biblically-based principles to its business, such as closing stores on Sundays.
The chain has one Chicago restaurant, but wants to put another in the city's Logan Square neighborhood. That's the area Moreno represents, and he says the restaurant can't move forward until he introduces an ordinance to divide the land involved.
Prosecutors: San Diego customs fraud topped $10M
SAN DIEGO (AP) — A federal complaint says a San Diego customs broker orchestrated a scheme to bring at least $100 million worth of Chinese textiles, Indian cigarettes and other goods to the United States without paying more than $10 million in tariffs and other fees.
The complaint unsealed Wednesday says Gerardo Chavez's scheme resulted in lost duties, taxes and other revenue for the U.S. government. Authorities say Asian goods presumably headed to Mexico were illegally unloaded at the Long Beach port.
Chavez and two other defendants were taken into custody Wednesday.
Chavez is president of the San Diego Customs Brokers Association, a trade group that represents 45 brokers doing business on California's border with Mexico. No one answered the phone at the organization's office.
USDA: Meatless Monday posting was a mistake
WASHINGTON (AP) — The Agriculture Department says a statement on its website encouraging its employees not to eat meat on Mondays was made without proper clearance.
The posting earlier this week was part of an internal newsletter that discusses how staff can reduce their environmental impact while dining at the agency's cafeteria.
The newsletter referred to United Nations data that cites animal agriculture as a major source of greenhouse gases and climate change.
USDA spokeswoman Cortney Rowe says the department does not endorse the "Meatless Monday" initiative, which is part of a global public health campaign.
The agency removed the posting hours after the National Cattlemen's Beef Association denounced it in a news release. The USDA often promotes the beef industry by encouraging Americans to eat meat.
United Tech to sell units to BC, Carlyle for $3.5B
HARTFORD, Conn. (AP) — United Technologies says it is selling three industrial-products businesses to private equity firms BC Partners and The Carlyle Group for $3.46 billion.
Proceeds from the sale will be used to repay some of the short-term debt needed to finance its proposed $16.5 billion acquisition of aerospace parts maker Goodrich Corp.
The sale of Milton Roy Co., Sullair Corp. and Sundyne Corp. is subject to regulatory approval and the deal is expected to close by the end of the year.
United Technologies Corp. is also selling off other divisions, including its Rocketdyne engine-making unit, as it transforms itself to focus on its core aerospace and building-systems businesses.
Standard & Poor's lowers Duke Energy credit rating
RALEIGH, N.C. (AP) — Standard & Poor's says it has lowered the credit rating for Duke Energy Corp., citing the utility's lack of transparency in hiring a new CEO.
In a statement issued Wednesday night, Standard & Poor's said the lack of transparency significantly heightens regulatory risk for the company.
The company has said it made a good faith effort in appointing a new head and expressed disappointment in the decision.
The move by S&P follows news of a shareholder lawsuit using sworn testimony by Duke Energy executives and directors to support claims that investors were misled by a surprise shuffle of top executives.
Duke stock is down 6 percent since the merger.