U.S. stocks closed in the red overnight, a sharp decline in durable goods orders fuelled concerns for the health of the economy, while investors reacted sourly to Yahoo’s partnership with Mircrosoft.
The Dow Jones industrial average dropped 26 points to 9,071. The S&P500 Index fell 4 to 975 and the NASDAQ declined 8 points to 1,968.
In economic news: The Commerce Department reports that durable goods orders fell 2.5 per cent in June after rising 1.3 per cent in May. The drop was a lot steeper than the expected 0.6 per cent decline. And the Federal Reserve released its ‘beige book’, survey of economic conditions, the report indicated that although economic activity remained weak, for most of the 12 districts the pace of the decline has slowed.
In company news: Shares in technology giant Yahoo! Inc (NASDAQ:YHOO) plunged 12.08 per cent to $15.14 and shares in Microsoft Corporation (NASDAQ:MSFT) gained 1.41 per cent to $23.80. The two companies have agreed on a 10 year partnership that is aimed at rivaling Google’s dominance in the online arena. According to CNN Money, Yahoo will use and promote Microsoft’s Bing search engine on its site. In return Yahoo will take 88 per cent of the revenue from all search ad sales for the first five years.
Shares in media and entertainment company Time Warner Inc (NYSE:TWX) lost 1.81 per cent to $26.52. The company posted better than expected earnings for the quarter, however revenue dropped on lower advertising spending and DVD sales.
Shares in energy company ConocoPhillips (NYSE:COP) fell 3.53 per cent to $42.86. The oil company reported a fall in profit, hurt by weaker oil prices and a loss recorded by the company’s refinery business.
Health insurer WellPoint Inc (NYSE:WLP) shares declined 5.7 per cent to $51.28. The company posted stronger than expected earnings but revenue that fell below estimates. The company also did not raise its outlook for the year.
Checking the NASDAQ Top 100: The best performer was Life Technologies Corp which added 7.67 per cent to $46.20. While Apollo Group and Teva Pharmaceuticals also climbed higher. The worst performing stock was Yahoo, price as mentioned before, with Steel Dynamics and NII Holdings also closing lower.
