Stocks sink as earnings scare investors
NEW YORK (AP) — Nobody was expecting this round of corporate earnings reports to be great. But some companies' underwhelming results are still rattling investors.
The Dow Jones industrial average plunged Tuesday to its lowest level in nearly seven weeks. Big-name companies reported weak quarterly revenue and lowered their forecasts for the rest of the year.
The Dow sank as much as 262 points, or roughly 2 percent, before ending the day down 243.36 points to 13,102.53. The decline was the Dow's third-steepest this year.
US may soon become world's top oil producer
NEW YORK (AP) — U.S. oil output is surging so fast that the United States could soon overtake Saudi Arabia as the world's biggest producer.
Driven by high prices and new drilling methods, U.S. production of crude and other liquid hydrocarbons is on track to rise 7 percent this year to an average of 10.9 million barrels per day. This will be the fourth straight year of crude increases and the biggest single-year gain since 1951.
The boom has surprised even the experts.
Apple reveals iPad Mini starting at $329
SAN JOSE, Calif. (AP) — Apple Inc. is refusing to compete on price with its rivals in the tablet market — it's pricing its new, smaller iPad well above the competition.
On Tuesday the company revealed the iPad Mini, with a screen that's about two-thirds the size of the full-size model, priced at $329 and up.
Apple starts taking orders for the new model on Friday, said marketing chief Phil Schiller at an event in San Jose, Calif. Wi-Fi-only models will start on Nov. 2. Later the company will add models capable of accessing "LTE" wireless data networks.
The price fits into the Apple product lineup between the iPad 2 at $399 and the latest version of the iPod touch at $299. But company watchers had expected Apple to price the iPad Mini at $250 to $300 to counter the threat of less expensive tablets like Amazon.com Inc.'s Kindle Fire, which starts at $159. Barnes & Noble Inc.'s Nook HD and Google Inc.'s Nexus 7 both start at $199.
Facebook posts 3Q loss, revenue jumps
NEW YORK (AP) — Facebook's third-quarter results inched past Wall Street's expectations, offering evidence that the company is making inroads in mobile advertising — a longtime concern among investors.
The financial results, Facebook's second as a public company, sent its stock sharply higher in after-hours trading. The stock about 10 percent after the announcement, on a day that saw the Dow Jones Industrial Average drop almost 2 percent.
The world's biggest social media company posted a loss of $59 million, or 2 cents per share, in the July-September period. That's down from earnings of $227 million, or 10 cents per share a year ago, when Facebook was still privately held.
UPS says consumers driving shipping growth
NEW YORK (AP) — UPS says online shoppers are propping up its business in a tough global economy.
The world's largest package delivery company believes that consumer demand for gadgets will drive its shipments and earnings this year, making up for slower trade between businesses.
The company also narrowed its earnings forecast for the year, and now expects growth of 5 to 7 percent from 2011. The stock rose 3 percent Tuesday afternoon.
DuPont to cut 1,500 jobs after 3Q profit slide
DOVER, Del. (AP) — The DuPont Co. said Tuesday that it will cut about 1,500 jobs and take other steps to increase its competitiveness, after weak demand for a key industrial pigment and uncertainty in the solar panel market led to a sharp drop in third-quarter earnings.
The chemical company reported net income of $10 million, or a penny per share, compared with $452 million, or 48 cents per share, for the same period last year. Excluding one-time items, DuPont earned 44 cents per share, compared with 69 cents per share for last year's third quarter. Revenue from continuing operations totaled about $7.4 billion, down 9 percent from $8.1 billion.
The results fell short of analysts' estimate of 46 cents per share, according to FactSet. DuPont shares fell 9 percent in Tuesday trading, contributing to a broad market decline.
3M cuts 2012 guidance, citing "economic realities'
MINNEAPOLIS (AP) — 3M Co. is reducing its profit expectations for this year because of what it calls "current economic realities."
3M makes everything from Post-it notes and Scotch tape to roofing granules, coatings for LCD screens, and traffic sign coatings. The variety of its businesses and its worldwide footprint make it an economic bellwether. And CEO Inge Thulin said what it's seeing right now is a "slow-growth economy."
The company now expects to earn $6.27 to $6.35 per share for the year, down from a previous forecast for profit of $6.35 to $6.50. Analysts expected $6.40 per share, according FactSet.
Netflix slashes its forecast for subscriber gains
LOS ANGELES (AP) — Netflix slashed its prediction of how many U.S. video streaming subscribers it would add this year after subpar third-quarter results, causing a sharp sell-off in its stock in after-hours trading.
The Los Gatos, Calif.-based video streaming company said it added 1.2 million net subscribers in the U.S. in the three months through September, which was at the low end of its previous forecast of gains between 1 million to 1.8 million.
The shortfall caused Netflix to cut its full-year estimate for U.S. streaming subscriber additions to between 4.7 million and 5.4 million. Netflix had predicted it would gain as many as 7 million domestic streaming subscribers by year's end. It ended the quarter with 25.1 million U.S. streaming customers and 4.3 million in other countries.
Ally to sell Canada auto finance operations
DETROIT (AP) — Ally Financial Inc., the former finance arm of General Motors that was bailed out by the U.S. government, is selling its Canadian auto finance unit to Royal Bank of Canada for $4.1 billion.
The deal, expected to close early next year, is part of Ally's plan to accelerate repayment of the $17.2 billion bailout, but it was unclear Tuesday exactly when the government would get more money. So far Ally has repaid $5.8 billion. The U.S. Treasury owns 74 percent of Ally common stock plus $5.9 billion of preferred stock.
Ally said in a statement that RBC will pay a $620 million premium over book value to buy Ally Credit Canada Limited and ResMor Trust. Book value for the third quarter was about $3.5 billion. Ally Credit Canada had about $9.4 billion in assets as of Sept. 30 and is among the largest auto financing businesses in Canada. ResMor Trust offers savings products to consumers and had about $4.2 billion in assets.
Target to sell credit card business to TD Bank
NEW YORK (AP) — Target Corp. on Tuesday said it reached a deal to sell its entire consumer credit card business to TD Bank Group, ending an almost two-year search for a buyer.
The discounter, based in Minneapolis, said the sale price is equal to the gross value of the outstanding receivables at the time of closing. Target's portfolio currently has a gross value of about $5.9 billion.
The two companies also entered into a seven-year pact under which TD Bank will underwrite, fund and own future Target credit card and Target Visa receivables in the U.S.
By The Associated Press(equals)
The Dow Jones industrial average fell as much as 262 points, or roughly 2 percent, before ending the day down 243.36 points to 13,102.53. The Standard & Poor's 500 index shed 20.71 points to 1,413.11, and the Nasdaq composite index lost 26.49 points to 2,990.46.
Benchmark oil dropped $1.98, or 2.3 percent, to finish at $86.67 per barrel in New York. Brent crude fell $1.19, or 1.1 percent, to end at $108.25 per barrel in London.
Heating oil fell 3.33 cents to finish at $3.043 per gallon. Natural gas rose 8.3 cents to end at $3.535 per 1,000 cubic feet. Gasoline fell 4.25 cents to end at $2.6050 a gallon.