Markets slump amid signs of lagging global output

NEW YORK – U.S. stocks took a hard knock Thursday as economic reports indicating a slowdown in global manufacturing increased investor anxiety.

Data illustrating a slowdown in euro-area manufacturing and Chinese output bruised commodities, with oil falling below $80 a barrel and gold prices below $1,600 an ounce.

“We are seeing general weakness, not just here, but around the world. It’s going to be very difficult for us to be an island of prosperity while the global economy is slowing,” said Paul Nolte, managing director at Dearborn Partners in Chicago.

The Dow Jones industrial average fell 250.82 points, or 2 percent, to 12,573.57. The S&P 500 index fell 30.18 points, or 2.2 percent, to 1,325.51. The Nasdaq composite fell 71.36 points, or 2.4 percent, to 2,859.09.

The dollar climbed against other global currencies, including the euro, and Treasury prices rose. Oil futures fell $3.25, or 4 percent, to $78.20 a barrel and gold futures fell $50.30 to close at $1,565.50 an ounce.

Moody’s trims credit ratings of 15 big banks around world

NEW YORK – Moody’s Investors Service lowered the credit ratings of 15 of the world’s largest banks late Thursday, including Bank of America, JPMorgan Chase and Goldman Sachs, saying their long-term prospects for profitability and growth are shrinking.

The ratings agency said it was especially concerned about banks with significant financial markets businesses because those markets have become so volatile. Some of the largest European banks were also downgraded, including Barclays, Deutsche Bank and HSBC.

The downgrades mean Moody’s is more concerned about the ability of the banks to repay their debts.

A downgrade usually means it becomes more costly for banks to raise money by selling debt. Investors demand higher interest for riskier debt, which is what the downgrades represent. However, with interest rates already at rock-bottom levels, the downgrades may not affect the cost of funding for the banks that much. Among the banks downgraded:

Bank of America’s debt was downgraded to Baa2 from Baa1. That’s just a couple of notches above junk status. JPMorgan Chase’s debt was downgraded to A2 from Aa3, Citigroup’s to Baa2 from A3, Morgan Stanley’s to Baa1 from A2, Goldman Sachs’s to A3 from A1, HSBC’s to Aa3 from Aa2, Barclay’s to A3 from A1.

Power used to operate iPad costs a mere $1.36 per year

NEW YORK – That coffee you’re drinking while gazing at your iPad? It cost more than all the electricity needed to run those games, emails, videos and news stories for a year.

The annual cost to charge an iPad is just $1.36, according to the Electric Power Research Institute, a nonprofit research-and-development group funded by electric utilities.

By comparison, a 60-watt compact fluorescent bulb costs $1.61, a desktop PC adds up to $28.21 and a refrigerator runs you $65.72.

The group studied the power consumption of Apple Inc.’s iPad to determine the effect that the newly popular devices might have on the nation’s electricity use.

The answer: not much. If the number of iPads triples from the current 67 million, they would need the electricity from one small power plant operating at full strength.

— From news service reports