US stocks fall on fresh recession fears, earnings

April 9th, 2008 - 7:20 am ICT by admin  

New York, April 9 (DPA) US stock indices retreated Tuesday amid a weak start to the first-quarter earnings season and warnings from the Federal Reserve of a prolonged economic downturn in the US. Advanced Micro Devices said it would slash 10 percent of its workforce and reported a 15-per-cent drop in first-quarter revenue, leading technology shares lower.

Washington Mutual, the country’s largest savings and loan firm, revealed an infusion of $7 billion from a group of private investors as it moved to cut 3,000 jobs, slash its dividend to stockholders and restrict its mortgage business.

The US central bank, according to minutes of its last board meeting on March 18, said a contraction of the US economy was likely in the first half of 2008, while some members feared a “protracted and severe economic downturn”.

The International Monetary Fund meanwhile forecast that financial insitutions will suffer losses totaling $945 billion as the US mortgage crisis spreads to other sectors of the credit market.

The blue-chip Dow Jones Industrial Average fell 39.99 points, or 0.29 percent, to 12,576.54. The broader Standard & Poor’s 500 Index was down 7 points, or 0.51 percent, to 1,365.54. The technology- heavy Nasdaq Composite Index dropped 16.07 points, or 0.68 percent, to 2,348.76.

The US currency was unchanged against the euro at 63.65 euro cents, but rose against the Japanese currency to 102.60 yen from 102.38 yen Friday.

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