Wall Street suffers more losses as fears of recession resurface
Digital Access For Only $0.99
For the most comprehensive local coverage, subscribe today.
A case of post-election nerves sent Wall Street plunging Wednesday as investors, looking past Barack Obama's presidential victory, returned to their fears of a deep and protracted recession. Volatility swept over the market again, with the Dow Jones industrials falling nearly 500 points and all the major indexes tumbling more than 5 percent. The market had been widely expected to give back some gains after a run-up that lifted the Standard & Poor's 500 index more than 18 percent and that gave the Dow its best weekly advance in 34 years.
Index shows slump in service sector
Hotels, construction firms and retailers saw business shrink in October as slower spending and declining employment sent the service sector into contraction, another gloomy sign for the economy. The Institute for Supply Management, a trade group of purchasing executives, said Wednesday its service sector index suffered a sharper-than-expected drop, to 44.4 in October from 50.2 in September. Wall Street economists surveyed by Thomson Reuters had expected a reading of 47.5. A reading of less than 50 signals contraction.
Bush administration to borrow $550 billion
The outgoing Bush administration on Wednesday detailed its plans to borrow a record $550 billion through the end of the year to back the financial bailout. The Federal Reserve, meanwhile, said it will boost interest payments to banks as authorities battle the worst financial crisis in decades. The Treasury Department said it will sell $55 billion in bonds next week, part of a massive borrowing effort to cover the $700 billion bailout and a budget deficit that's expected to hit a record of nearly $1 trillion next year.
Google ends planned Yahoo ad alliance
Google Inc. has scrapped its Internet advertising partnership with struggling rival Yahoo Inc., abandoning attempts to overcome the objections of antitrust regulators and customers who thought the alliance would give Google too much power over online commerce. The retreat announced Wednesday was another setback for Yahoo, which had been counting on the Google deal to boost its finances and placate shareholders still incensed by management's decision to reject a $47.5 billion takeover bid from Microsoft Corp. six months ago.
Wells Fargo to offer $10 billion in stock
Wells Fargo & Co. said Wednesday that it will sell $10 billion worth of common stock in a public offering expected to price after the market closes Thursday. The San Francisco-based bank has said it plans to raise up to $20 billion to maintain a strong capital position as it absorbs the operations of Wachovia Corp., which was on the brink of failure before the deal was struck last month.
Apple has added 10,000 full-time workers
Apple Inc. boosted the number of workers on its payroll by 48 percent in the 2008 fiscal year, a period that saw robust iPod sales and the staggeringly successful launch of a new iPhone. In a Securities and Exchange filing Wednesday, company said it employed 32,000 full-time workers and 3,100 temporary employees and contractors as of Sept. 27. In fiscal 2007, Apple reported 21,600 full-time employees and 2,100 temporary and contract workers. The increase was reported early Wednesday by technology blog TechFlash.com. Eight thousand of those people went to work in Apple's retail segment, which opened 50 new stores in 2008, according to the filing.
Drug firm to cut 1,000 in U.S. sales force
British drug maker GlaxoSmithKline PLC is restructuring its U.S. operations, starting with reducing its U.S. sales force by 1,000, following many of its top competitors in eliminating sales jobs. The world's No. 2 drug maker by revenue also will switch from having dual U.S. headquarters, in Philadelphia and in Research Triangle Park, N.C., to operating just the North Carolina headquarters.
Ceradyne gets $21.9 million order
Ceradyne Inc. has received a $21.9 million order for lightweight body armor from the Defense Supply Center Philadelphia. The armor is known as ESAPI, or enhanced small-arms protective inserts. It will be delivered by March 31. The order is part of a three-year federal contract issued in December 2007, Ceradyne said Wednesday. The company makes the armor at one of its two ceramics plants in Lexington and also at a plant in California, where Ceradyne is based. The stock is listed by Nasdaq as CRDN.
Compiled from Staff, wire reports