William Nichols Comments: US Stocks Drop Most Since July As Fed Predicts Slower Economic Growth
August 14, 2010, Bloomberg.com
Cisco said sales this quarter will be as low as $10.64 billion, less than the average analyst estimate of $10.95 billion, according to data compiled by Bloomberg.
Technology companies in the S&P 500 dropped 5.6 percent, the most in six weeks. HP posted the third-biggest drop, tumbling 13 percent to $40.45 for the largest weekly slide since February 2009.
HP Chief Executive Officer Mark Hurd resigned because of an investigation that found he had a personal relationship with a contractor who received inappropriate payments from the company, the world’s biggest maker of personal computers and printers.
Alcoa slumped 8.2 percent to $10.64. JPMorgan lost 7.3 percent to $37.50. Jobless claims exceeded economists’ projections, adding to concern the recovery is stalling. Initial claims unexpectedly rose by 2,000 to 484,000 in the week ended Aug. 7, the highest level since mid-February, the U.S. Labor Department said Aug. 12.
Dynegy jumped 26 percent to $4.53. Blackstone Group LP agreed to buy the Texas power producer, which lost 94 percent of its market value in the past three years, for more than $540 million.
Unica Corp. surged 131 percent to $20.84. International Business Machines Corp., the world’s largest computer-services provider, said yesterday that it would buy Unica for about $480 million to gain technology to build marketing campaigns. IBM fell 1.7 percent to $127.87 this week.
“People are concerned about a general economic slowdown, but on the good side of the ledger is that corporate America and investors are sitting on a pile of cash,” said William Nichols, co-head of U.S. equities at Cantor Fitzgerald LP in New York.
