Stocks Hover in Red Territory, European Equities End Lower
U.S. stocks traded in red territory by midday trade on Thursday as some weaker than expected earnings from bigwigs such as United Parcel Service (NYSE: UPS) and Dow Chemical Company (NYSE: DOW) kept sentiment subdued notwithstanding some good better than expected economic indicators.
Shares of UPS fell nearly 1.75% on Thursday after the world’s largest packing shipping company provided downbeat outlook on fiscal 2013 while earnings in the fiscal fourth quarter missed Street’s forecast.
Shares of Dow Chemical slumped almost 5% by midday trade after the company said that fiscal fourth-quarter losses widened due to huge restructuring charges and extremely volatile macroeconomic environment during the second half of 2012.
Research in Motion Limited (NASDAQ: RIMM) plunged 6.59%, at last check, a day after the company unveiled its keenly anticipated operating system Blackberry10 or BB10 which works on its two generation next smartphones Blackberry Z10 and BlackberryQ10. The move is seen as a make or break by analysts. However, many experts doubt whether the new launch will make any difference for the beleaguered company. Analysts say that the move is very late considering the competitive landscape of smartphone market.
On economic news front, Chicago’s manufacturing purchasing managers index (PMI) climbed to 56 in January, up from 50.0 in December. A reading above 50 signifies economic expansion. Economists’ consensus estimate was for a reading of less than 50.
According to Labor Department, initial claims rose by 38,000 to seasonally adjusted 368,000. In the previous week initial claims fell to 330,000, which was lowest level in last five years.
In a separate data, consumer spending climbed 2.6% while personal income rose 0.2% in December. Economists were expecting consumer spending to rise by 1%.
European shares ended lower with Pan European Stoxx 600 Index ending 0.49% lower.