Bernanke’s forecast sends stocks skidding
Wall Street retreated Thursday after Federal Reserve Chairman Ben Bernanke predicted a “sluggish” economy until later in the year and more mortgage-related losses at banks. The Dow Jones industrial average fell 175 points.
Though the Fed chairman’s comments suggested the central bank is still open to further interest rate reductions, the tone was, as expected, somber. Bernanke said the housing and credit crises have weighed on the economy and curbed hiring. The Dow fell 175.26, or 1.40 percent, to 12,376.98, after gaining 370 points, total, in the previous three sessions.
Broader stock indicators also declined. The Standard & Poor’s 500 index fell 18.35, or 1.34 percent, to 1,348.86, and the Nasdaq composite index fell 41.39, or 1.74 percent, to 2,332.54.
High-profit tires help earnings for Goodyear
Goodyear Tire & Rubber Co.’s focus on selling tires with high profit margins is paying off for the company, which said Thursday it swung to a quarterly profit on strong U.S. and international sales.
The world’s third-largest tire maker earned $52 million, or 23 cents a share, in the fourth quarter ended Dec. 31, reversing a loss of $358 million, or $2.02, in the year-earlier period when results were brought down by a steel workers strike at North American factories.
Discounting charges totaling 26 cents per share and a tax-related gain of 4 cents per share, earnings from continuing operations were 49 cents per share for the quarter.
Sales rose 11 percent to $5.16 billion.
Judge to decide if he’ll cut Wyeth case award
A judge will decide by early next week whether to reduce a $134 million judgment that jurors awarded three Nevada women in October after deciding drug-maker Wyeth caused the women’s breast cancer.
Washoe County District Court Judge Robert Perry said he’ll issue a written ruling by Tuesday on the giant pharmaceutical company’s request to find the award illegally excessive and slash it to closer to $5 million.
The judgment remains the largest award to date against the Madison, N.J.-based company, which faces about 5,300 similar lawsuits across the country in state and federal courts.
All involve the drugs Premarin, an estrogen replacement, and Prempro, a combination of estrogen and progestin. The drugs are prescribed to women to ease menopause symptoms.
The jurors in Reno awarded Jeraldine Scofield, 74, of Fallon; Arlene Rowatt, 67, of Incline Village; and Pamela Forrester, 65, of Yerington, a combined $35 million for medical expenses and physical and emotional pain and suffering.
Sharper Image names new chief executive
Sharper Image Corp. named a crisis management expert as its new chief executive Thursday, marking the third time in 17 months that the struggling specialty retailer has ushered in a new leader as it tries to survive a worsening sales slump.
The San Francisco-based company brought in Ron Conway, who runs a New York-based turnaround firm, as its CEO less than a year after hiring direct marketing veteran Steven Lightman to steer Sharper Image’s 183-store chain.
Lightman replaced Sharper Image Chairman Jerry Levin, who temporarily stepped in as CEO after the company ousted founder Richard Thalheimer from the job.
Sharper Image gave no reason for Lightman’s departure in a statement announcing Conway as its new CEO. Company spokesman Tersh Barber wouldn’t say Thursday whether Lightman resigned or was fired.
Demand for e-cards high on Valentine’s Day
Some greeting-card Web sites had trouble meeting demand on Valentine’s Day, although one apparently prepared for the rush and did better than usual Thursday, a performance-measurement company said.
Keynote Systems, whose automated probes in 10 U.S. cities check sites every 15 minutes, said that at times, only 30 percent of the attempts to reach those sites succeeded, with visitors unable to access the electronic cards they received or reach a site’s home page the rest of the time.
The Web site for Hallmark Cards was inaccessible or slow starting about 6 a.m. EST, Keynote said. It was back to normal by late morning but got slow again around noon — just as people on the West Coast got to work and opened cards that in their in-boxes, said Shawn White, Keynote’s director of external operations.
Keynote said it also spotted problems with 123Greetings.com, and The Associated Press found in a test Thursday afternoon that many pages took several seconds to load.
Unemployment news sparks Treasurys sell-off
Long-term Treasurys sold off for a third straight session Thursday after the latest weekly unemployment benefits tally suggested some stabilization in a worrisome labor market.
The benchmark 10-year Treasury note fell 0.78 points to 97.38 with a yield of 3.82 percent, up from 3.73 percent late Wednesday, according to BGCantor Market Data. Prices and yields move in opposite directions.
The 30-year long bond dropped 1.59 to 95.53 with a yield of 4.65 percent, up from 4.55 percent.