On Friday July 16, 2010, 5:58 pm EDT
Banks eye higher fees to
boost declining revenue
NEW YORK (AP) -- Big banks
facing big drops in revenue are looking to Main Street to make up the
difference.
Checking accounts, bank
statements, even popping into your local bank branch could carry a hefty cost
as the nation's mega-banks scramble to offset expected damage from the sweeping
financial overhaul. The uncertain future has overshadowed otherwise strong
second-quarter earnings at JPMorgan Chase & Co., Citigroup Inc. and Bank of
America Corp.
All three companies beat
expectations this week with profitable results. Yet their stocks tumbled,
helping send the wider market sharply lower Friday.
Less-confident consumers
could stall recovery
WASHINGTON (AP) -- A report
released Friday showed that consumer confidence fell in July to its lowest
point in nearly a year. A volatile stock market, near-double-digit
unemployment, lackluster wage gains and a stalled housing market have raised
fears that the recovery is on the verge of stalling.
Americans reacted by
clamping down on their spending in May and June. Many cut back after the stock
market lost about 10 percent of its value over the past three months, as
Europe's debt crisis shook Wall Street. The resulting loss of household wealth
has left many Americans less inclined to spend.
Stocks drop on weak
consumer sentiment, bank earns
NEW YORK (AP) -- Investors
are finding disappointment everywhere and taking out their frustration on
stocks.
Stocks slumped Friday after
banks' second-quarter earnings fell short of expectations and a new survey
found that consumers are becoming more pessimistic. The Dow Jones industrial
average lost 261 points, and all the major market indexes dropped more than 2.5
percent. Interest rates fell in the Treasury market as investors once again
sought the safety of government securities.
For the week, the Dow is
down 1 percent, the S&P 500 is down 1.2 percent, and the Nasdaq is down 0.8
percent.
About four stocks fell for
every one that rose on the New York Stock Exchange, where volume came to 1.5
billion shares.
GE breaks string of profit
drops but revenue falls
Cost cutting and an
improved financial business helped General Electric Co. post its first increase
in quarterly profit since 2007 on Friday, but sales remained sluggish for the
industrial and financial giant.
The better earnings ended a
long string of declines at the Fairfield, Conn.-based company, which makes
everything from refrigerators to jet engines. GE's outlook was largely upbeat,
helped by improving orders and lower losses and its GE Capital lending unit. It
sees profits continuing to grow next year.
But the second-quarter
results also reflect challenges posed to big companies by the nation's halting
recovery. GE's revenue slipped 4 percent as industries like transportation were
down.
China reduces US Treasury
debt holdings in May
WASHINGTON (AP) -- China
reduced its holdings of U.S. Treasury debt in May as total foreign holdings of
government debt posted a slight increase.
China's holdings fell by
$32.5 billion to $867.7 billion, the Treasury reported Friday.
The report said that total
holdings of Treasury securities edged up $5.8 billion to $3.96 trillion in May,
a slight increase of 0.1 percent compared to April.
The Treasury said that net
purchases of long-term securities, a category that covers not only U.S.
government debt but also debt of U.S. companies, increased by $35.4 billion in
May. That followed bigger gains of $81.5 billion in April and $141.4 billion in
March.
Gannett's stock dives after
2Q results disappoint
Gannett Co., the largest
U.S. newspaper publisher, moved closer to ending a 3 1/2-year slump in print
advertising during the second quarter. But it still isn't feeling confident
enough to predict when the biggest part of its business will begin to grow
again.
The progress contained in
earnings results released Friday evidently wasn't enough to satisfy investors,
especially given management's hazy outlook. Gannett shares plunged more than 10
percent.
As the owner of USA Today
and more than 80 other daily newspapers, Gannett serves as a publishing
bellwether. The New York Times Co., Lee Enterprises Inc. and McClatchy Co. are
among the other major newspaper publishers scheduled to report earnings during
the next two weeks.
Feds: Test results from
well not as good as hoped
NEW ORLEANS (AP) --
Pressure readings have been less than ideal from the new cap shutting oil into
BP's busted well, but the crude will remain locked in while engineers look for
evidence of whether there is an undiscovered leak, the federal pointman for the
disaster said Friday.
Retired Coast Guard Adm.
Thad Allen said on a conference call that pressure readings from the cap have
not reached the level that would show there are no new leaks in the well.
Allen said BP's test of the
cap, which started 24 hours previously by shutting three valves and stopping
the flow of oil into the water, would continue for at least 6 hours. It was
scheduled to last up to 48 hours.
Dell: SEC staff to
recommend accounting settlement
ROUND ROCK, Texas (AP) --
Computer maker Dell Inc. said Friday it's getting closer to settling
investigations by regulators into its accounting and the actions of CEO Michael
Dell.
The computer maker has
proposed settlements to the staff of the Securities and Exchange Commission,
which the staff will recommend to the commissioners, the company said.
Dell has already set aside
$100 million to cover the cost of settling charges that employees had misled
auditors and manipulated results to meet performance targets.
Apple CEO on antenna
problem: 'We aren't perfect'
CUPERTINO, Calif. (AP) -- A
perfect iPhone? There's no app for that. Apple Inc. will give free protective
cases to buyers of its latest iPhone to prevent reception problems that occur
when people cover a certain spot on the phone with a bare hand.
CEO Steve Jobs apologized
Friday to people who are less than satisfied with the iPhone 4, even as he
denied it has an antenna problem that needs fixing.
The more than 3 million
people who have already bought an iPhone 4 can go to Apple's website starting
late next week and sign up for a free case, he said. Apple can't make enough of
its $29 "Bumper" cases for everyone, so the company will let people
chose from several case styles.
Regulators shut South
Carolina bank
WASHINGTON (AP) --
Regulators have shut down a South Carolina bank, bringing to 91 the number of
U.S. banks failures this year amid the recession and mounting loan defaults.
The Federal Deposit
Insurance Corp. on Friday took over Woodlands Bank, based in Bluffton, S.C.,
with $376.2 million in assets. Bank of the Ozarks, based in Little Rock, Ark.,
agreed to assume the assets and deposits of the failed bank.
The failure of Woodlands
Bank is expected to cost the deposit insurance fund $115 million.
By The Associated Press
The Dow fell 261.41, or 2.5
percent, to 10,097.90.
The Standard & Poor's
500 index fell 31.60, or 2.9 percent, to 1,064.88. The Nasdaq composite index
fell 70.03, or 3.1 percent, to 2,179.05.
Benchmark crude for August
delivery settled down 61 cents at $76.01 a barrel on the New York Mercantile
Exchange in reaction to the economic news.
Heating oil lost 0.7 cent
to $2.0113 a gallon, gasoline fell 1.21 cents to $2.0486 a gallon and natural
gas fell 6.7 cents to $4.519 per 1,000 cubic feet.
In London, Brent crude fell
16 cents to $75.37 a barrel on the ICE Futures exchange.