Wall Street trades lower on corporate earning concernsDecember 10th, 2008 - 11:08 am ICT by IANS
New York, Dec 10 (Xinhua) The US stocks traded lower Tuesday after two straight gaining sessions as investors responded to disappointing company profit outlooks and better-than-expected pending home sales. Wall Street initially opened lower on the gloomy earnings forecasts of FedEx Corp. and Texas Instruments.
The second-largest US package-shipping company FedEx cut its forecast for fiscal 2009 earnings, while chipmaker Texas Instruments gave out lower-than-expected forecasts of the fourth-quarter earnings, warning that the business would deteriorate further as the economic continued to worsen.
To make it worse, Japanese electronics maker Sony Corp. announced a headcount cut plan of 8,000 jobs of its global work force in a bid to cut costs by $1.1 billion a year as the global economy slowdown worsened.
But in economic news, the US National Association of Realtors Pending Home Sales Index slipped 0.7 percent to 88.9 in October from an upwardly revised reading of 89.5 in September. The decline is smaller than the market had predicted, which gave investors cautious optimism of the housing market.
Investors were also hoping that an agreement of $15 billion loan package to the struggling US auto industry would get voted as early as Wednesday. Investors have been concerned that the bankruptcy of General Motors Corp., Chrysler LLC and Ford Motor Co. will result in massive job losses.
The Dow Jones industrial average fell 242.85 points, or 2.72 percent, to 8,691.33. The Standard & Poor’s 500 was down 21.03 points, or 2.31 percent, at 888.67 while the Nasdaq Composite was down 24.40 points, or 1.55 percent, at 1,547.34.
Tags: cautious optimism, dow jones industrial, dow jones industrial average, fedex corp, ford motor co, fourth quarter earnings, global work force, massive job losses, new york dec, pending home sales index