Indexes fall most in 2 weeks
Signs of a slowing economy dragged down the stock market Wednesday. Even the prospect of continued stimulus from the Federal Reserve didn’t help.
Major market indexes fell by 0.9 percent, their worst decline in two weeks. Small-company stocks fell even more, 2.5 percent, as investors shunned risk. The yield on the benchmark U.S. government bond fell to its lowest of the year as investors sought safety.
Stocks opened lower and kept sagging throughout the day, hurt by reports of a slowdown in hiring and manufacturing last month. Discouraging earnings news from major U.S. companies also dragged the market lower.
The Dow Jones industrial average closed down 138.85 points to 14,700 points. Merck, the giant drug company, had one of the biggest falls in the Dow after reporting earnings that disappointed investors. The Dow had risen for four days straight.
The Standard & Poor’s 500 index, a broader market measure, dropped 14.87 to 1,582.70.
Mobile ads boost Facebook
Facebook’s net income and revenue grew in the first quarter of the year, helped by an increase in mobile ad revenue, a figure that some skeptical investors have been watching closely.
Facebook Inc. said Wednesday that its net income was $219 million, or 9 cents per share, in the January-March period. That’s up from $205 million, or 9 cents per share, in the same period a year ago when the company was still private.
Revenue grew 38 percent to $1.46 billion from $1.06 billion, surpassing analysts’ expectations of $1.44 billion.
Vehicle sales rev up in April
Ford, GM, Chrysler and Nissan all reported double-digit U.S. sales increases last month, signaling the best April for car and truck sales in six years.
A rebound in pickup truck sales led the way, especially for the Detroit automakers. Small businesses are replacing aging trucks that they’ve kept since the Great Recession.
Ford’s sales increased 18 percent, with the F-Series pickup gaining 24 percent. At Chrysler, sales rose 11 percent, led by the Ram pickup, with a 49 percent sales increase. GM also saw an 11 percent sales jump, with Chevrolet Silverado pickup sales rising 28 percent for the month.
PepsiCo pulls offensive ad
PepsiCo is again learning the risks of celebrity partnerships after an ad for Mountain Dew was criticized for portraying racial stereotypes and making light of violence toward women.
The company said it immediately pulled the 60-second spot after learning that people found it offensive. It was part of a series developed by black rapper Tyler, The Creator.
- From news service reports