The stock market is having a serious case of jitters, brought on by reports suggesting a slowdown for manufacturing. But the worst one-day plunge since last June may also be related to the winter blahs. Investor worries on Wall Street spread overseas, with Japan’s Nikkei Index plunging 4 percent overnight. The Dow Jones Index fell 326 points yesterday – its seventh triple-digit loss this year. US factory output grew more slowly last month and auto sales were generally disappointing.
Repeated snow storms in some of the most heavily populated parts of the Mid West and Northeast could be having a temporary impact on the economy. “Manufacturing facilities were shut down and suppliers were unable to get their supplies to the manufacturing facilities that were in other parts of the country: parts that didn’t have as bad weather,” says economist Diane Swonk of Mesirow Financial in Chicago. “What you saw was sort of this collateral damage that’s exacerbating our sense of weakness.” Some market professionals see the drop in stocks as a needed correction after a stellar 2013.
US companies are reporting strong profits for the fourth quarter of last year. But most are failing to impress investors who were hoping for even more. With results in from half of the companies in the S&P 500 index, earnings are up a respectable 7.3 percent on an annual basis. Of the 250 companies that have reported results, 172 have beaten expectations and 51 have fallen short, a better ratio than average.
A mid-sized hotel chain is the latest company to be hit by a suspected data breach. White Lodging Services says the breach may have compromised the credit and debit card information of customers who stayed at 14 properties in eight states last year, from March to December. White Lodging did not say how many customers may have been affected. The company owns and manages 168 hotels under various Marriott, Hyatt and Hilton brands in 21 states.
Banks and retailers clashed at a congressional hearing on data thefts. “Our nation’s banks are making the customers whole, not the retailers who suffered the breach,” said James Reuter of the National Bankers Association. Retailers want more secure chip technology on credit cards, similar to what Europe and Canada already has.
Toyota – the world’s biggest carmaker – says its quarterly profit rose more than five-fold from the year before. The auto firm raised its earnings forecast for this year. Switzerland’s leading bank UBS says it earned a billion dollars in the fourth quarter, compared with a huge loss the year before..
Facebook is 10 years old today. The world’s largest social media company helped start an online revolution in the way people connect and share information. Although there were other social sites before Facebook, “they just kind of did it better,” says Michael Gorman at Engadget. With the shift in mobile, “the change at Facebook has accelerated considerably,” says Gorman. It’s gone from a desktop-based network “to a very much more mobile company,” reflecting changes elsewhere on the web.
Richard Davies Business Correspondent ABC News Radio abcnews.com Twitter: daviesnow