The Joplin Globe, Joplin, MO

Business

May 16, 2013

Weak open on Wall Street; Wal-Mart disappoints

NEW YORK — Wal-Mart led the Dow Jones industrial average lower early Thursday after the world’s largest retailer turned in weaker sales and a dim forecast for profits.

An unexpected slowdown in manufacturing in the mid-Atlantic region also discouraged investors, sending stock prices down and bond prices up.

A half-hour after the opening bell, the Dow was down 27 points at 15,248, a loss of 0.2 percent. The Standard & Poor’s 500 index was up four points at 1,655, a slip of 0.2 percent.

Wal-Mart fell 2 percent, or $1.68, to $78.11. The company blamed bad weather and delayed tax refunds for earnings and sales that fell short of what analysts had expected.

The news on the economy Thursday wasn’t encouraging. The Philadelphia branch of the Federal Reserve reported that manufacturers in the region said business conditioned worsened this month. Demand for manufactured goods was weak and shipments decreased sharply.

In Washington, the Labor Department reported that the number of Americans seeking unemployment benefits rose last week to 360,000. That suggests layoffs could be increasing, just one week after applications for benefits hit a five-year low.

Cisco Systems jumped 13 percent, or $2.68, to $23.90, the biggest gain of the 30 stocks in the Dow average. The technology company reported results late Wednesday that beat analysts’ expectations, with the help of better revenue from the U.S. and emerging markets.

The networking equipment company sells its routers, switches, software and services to corporate customers and government agencies around the world. As a result, Cisco’s performance is often considered a gauge of how the technology industry is doing.

The yield on the 10-year Treasury note sank to 1.87 percent from 1.94 percent late Wednesday. That means traders are shifting money into low-risk investments like U.S. government debt.

The Nasdaq composite index, which is heavily weighted with technology stocks, edged up four points to 3,476, or 0.2 percent.

 

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