US stocks fall on earnings fears despite China stimulusNovember 11th, 2008 - 8:45 am ICT by IANS
New York, Nov 11 (DPA) US stock indices posted losses Monday after fresh earnings concerns arose for some of the country’s top companies, outweighing a $588-billion Chinese economic stimulus package that had spurred gains on other stock exchanges around the world.Goldman Sachs Group Inc, technology giant Google Inc and automaker General Motors Corp all suffered downgraded outlooks. Goldman, despite having weathered the financial storm better than other major US investment banks, may post its first quarterly loss since going public nine years ago, according to Barclays Plc.
Fannie Mae, the recently nationalised US mortgage lender, posted a record quarterly loss Monday, while the US Treasury Department announced plans for an additional $40-billion stock investment in struggling insurance giant American International Group (AIG).
The earnings fears overshadowed China’s announcement that it would invest $588 billion in stimulus measures for its own slowing economy: infrastructure projects, tax cuts and loosening bank lending requirements.
China’s measures, coupled with a promise from finance ministers of the Group of 20 leading economies to move “urgently” to rescue the global economy, helped stocks around the world post gains Monday.
The blue-chip Dow Jones Industrial Average lost 73.27 points, or 0.82 percent, to close at 8,870.55. The broader Standard Poor’s 500 Index was down 11.78 points, or 1.27 percent, to 919.21, while the technology-heavy Nasdaq Composite Index declined 30.7 points, or 1.86 percent, to end at 1,616.74.
The US currency fell to 78.46 euro cents from 78.63 euro cents Friday. The dollar dropped to 98.03 yen from 98.22 yen Friday.
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