On Tuesday August 3, 2010, 6:08 pm EDT
Consumer spending and
personal incomes both weak
WASHINGTON (AP) --
Consumers did not boost their spending in June and their incomes failed to
increase, further evidence that the economic recovery slowed in the spring. And
Americans saved at the highest rate in nearly a year.
Personal spending was
unchanged in June, the Commerce Department reported Tuesday. It was the third
straight month of lackluster consumer demand. Incomes were also flat, the
weakest showing in nine months.
The lack of growth for
spending and incomes shows the economy ended the second quarter on a weak note.
Many analysts believe growth will slow further in the second half of the year
as high unemployment, shaky consumer confidence and renewed troubles in housing
weigh on the year-old economic recovery.
Factory orders drop for
second straight month
WASHINGTON (AP) -- Factory
orders fell in June for the second straight month due to lower demand for
steel, construction machinery and aircraft.
The Commerce Department
said Tuesday that factory orders dropped by 1.2 percent to a seasonally
adjusted $406.4 billion. Analysts expected a much smaller drop.
May's decline was revised
to a steeper decrease of 1.8 percent. It was initially reported as a 1.4
percent drop.
The two months of declines
follow nine straight month of increases, as manufacturers ramped up production
last fall and helped the U.S. economy grow after four quarters of contraction.
Stocks fall after weak
earnings, economic reports
NEW YORK (AP) -- The stock
market put its big rally on hold Tuesday after disappointing earnings and
economic reports reminded investors of the obstacles still facing the economy.
The Dow Jones industrial
average fell 38 points after rising 208 Monday on brighter economic news. All
the major indexes fell moderately.
Investors were unhappy with
just about every major earnings or economic report Tuesday. The stream of bad
news was a reminder that the recovery is going to be bumpy and slow.
US auto sales rise, helped
by credit, promotions
DETROIT (AP) -- Automakers
posted higher U.S. sales last month, a sign that Americans are still willing to
buy big-ticket items even though concerns linger about the economy and hiring.
After a sluggish June,
sales rose slightly for General Motors Co. and Chrysler. Foreign-based
companies such as Toyota and Honda posted bigger gains. Ford, meanwhile, had
flat sales.
Sales were boosted by
easier credit and new versions of cars and trucks ranging from Jeeps to large
family wagons. Summer promotions also helped.
Pending home sales sink 2.6
percent in June
WASHINGTON (AP) -- The
number of buyers who signed contracts to purchase homes dropped in June, as the
weak economy and tight lending standards kept consumers away from the housing
market.
The National Association of
Realtors said Tuesday that its seasonally adjusted index of sales agreements
for previously occupied homes dipped 2.6 percent to a reading of 75.7.
That was the lowest on
records dating back to 2001 and down nearly 19 percent from the same month a
year earlier. The index has fallen more than 40 percent from its peak in April
2005. May's reading was revised slightly downward to 77.7.
P&G 4Q profit falls
short after big ad spend
CINCINNATI (AP) -- Procter
& Gamble Co. is betting that heavy advertising will draw budget-conscious
households to new products, even those with higher prices, as it tries to build
sales and market share in a tough economy.
The consumer products maker
reported Tuesday that net income fell 12 percent in its fourth quarter, largely
because of company-record spending on marketing. Revenue rose 5 percent, and
the company expects continued growth over the next year.
Smaller rival Clorox Co.
also said more spending on promotions, and tough competition, took a bite out
of fourth-quarter results. The maker of its namesake bleach and Glad trash bags
said net income was nearly flat, even though revenue was up 1 percent.
Dow turns profit, but not
enough for Wall Street
NEW YORK (AP) -- Wall
Street is wondering if Dow Chemical Co. has been too optimistic in its profit
forecasts after second-quarter results fell short of expectations.
The nation's largest
chemical maker said Tuesday that increased demand and higher prices for
chemicals used in products ranging from consumer electronics to adhesives
helped it swing to a profit from a year-ago loss.
But the results fell below
the expectations of analysts. Dow Chemical shares dropped 9.2 percent to
$25.72. S&P Equity Research cut its 12-month price target for Dow to $30
from $34 after the results were released.
Drugmaker Pfizer posts 9
percent jump in 2Q profit
Pfizer Inc. on Tuesday
reported a 9 percent rise in second-quarter profit, trouncing Wall Street
expectations as revenue jumped 58 percent due to favorable currency rates and
its mega-acquisition of fellow drugmaker Wyeth last October. Shares jumped 5
percent on the surprisingly strong report.
The maker of cholesterol
blockbuster Lipitor and impotence pill Viagra said net income for the three
months ended July 4 rose to $2.48 billion, or 31 cents per share. A year ago,
income was $2.26 billion, or 34 cents a share. Pfizer has since sold millions
of new shares to help pay for Wyeth.
Barnes & Noble may put
itself up for sale
NEW YORK (AP) -- Book
retailer Barnes & Noble Inc. said its shares have slumped so low it may put
itself on the block -- possibly selling the chain to an investment group that
would include its founder and biggest shareholder, Leonard Riggio.
The world's largest
bookseller said late Tuesday that its board is evaluating several options to
boost shareholder value in the face of a depressed stock price, including
selling the company. Riggio, who holds some 28 percent of the company, said
he's considering joining an investor group to buy the retailer.
New BlackBerry is badly
needed flagship for RIM
NEW YORK (AP) -- Research
In Motion Ltd., the maker of the BlackBerry, revealed a new phone Tuesday that
says the company is still in the game, but it's doing so by catching up to the
competition rather than by breaking new ground.
The Torch will be RIM's
first device with both a touch screen and the BlackBerry's signature
full-alphabet keypad. It hits AT&T stores on Aug. 12 for $199 with a
two-year contract.
Meanwhile, RIM is
scrambling to deal with suspicion from foreign governments threatened by the
very thing that's made the phones such a success in the corporate market -- the
assurance that a user's e-mail is private.
By The Associated Press
The Dow fell 38.00, or 0.4
percent, to 10,636.38.
The Standard & Poor's
500 index fell 5.40, or 0.5 percent, to 1,120.46, while the Nasdaq composite
index fell 11.84, or 0.5 percent, to 2,283.52.
Benchmark crude for
September delivery gained $1.21, or 1.5 percent, to settle at $82.55 a barrel
on the New York Mercantile Exchange as traders instead took their cue from a
weaker dollar.
In other Nymex trading in
September contracts, heating oil rose 4.62 cents to $2.2000 a gallon, gasoline
added 2.5 cents to $2.1935 a gallon while natural gas fell 6.2 cents to 4.639
per 1,000 cubic feet.
In London, Brent crude
settled up $1.86 at $82.68 a barrel on the ICE Futures exchange.