World stocks fell Friday after credit downgrades slapped on Spanish banks unnerved investors already worried about the stability of the 17-country euro currency union.
The fall in European shares followed a sharp downturn in Asia where markets were also rattled by weak U.S. manufacturing figures.
The nervousness about Spain’s banks comes as the European financial crisis intensifies.
Political turmoil in Greece has increased the likelihood that it could leave the 17-country monetary union, a move that could have ripple effects throughout Europe and the world’s financial markets.
Britain’s FTSE 100 fell 0.8 percent to 5,295.30 and Germany’s DAX was 0.5 percent lower at 6,279.36. France’s CAC-40 lost 0.7 percent to 2,991.85.
But Wall Street looked set for a higher opening on Friday when shares of social media giant Facebook will start trading. Buyer demand is expected to be very strong. Dow Jones industrial futures rose 0.2 percent to 12,439 and S&P 500 futures added 0.2 percent to 1,304.40.
Markets were jolted by Moody’s downgrade Thursday of 16 Spanish banks, said Jackson Wong, vice president at Tanrich Securities in Hong Kong.
Moody’s said it took the action because the banks face a rising tide of bad loans linked to Spain’s recession, a gloomy real estate market and high unemployment.
“It’s very hard to predict how the euro crisis will evolve. All the news is bad, so investors like to stay on the sidelines even though stocks are very attractive right now,” Wong said.
Japan’s Nikkei 225 tumbled 3 percent to close at 8,611.31, its lowest finish in four months as signs of weakness in the U.S., a critical export market for Japanese companies, battered some of the country’s behemoth manufacturers.
Hong Kong’s Hang Seng dropped 1.3 percent to 18,951.85 and Australia’s S&P/ASX 200 slid 2.7 percent to 4,046.50. South Korea’s Kospi tumbled 3.4 percent to 1,782.46. Benchmarks in Singapore, Taiwan and New Zealand also fell.
Mainland Chinese shares lost ground, with the benchmark Shanghai Composite Index losing 1.4 percent to 2,344.52. The Shenzhen Composite Index fell 1.5 percent to 940.91. Shares in ports and trading related companies led the gains, while shares in banks, shipping and defense industry companies weakened.
“The investors are pessimistic over China’s economic outlook, on top of the problems in Europe. It is more like a panic selling,” said Guo Yanhong, an analyst at Huachuang Securities, based in Beijing.
In the U.S., meanwhile, the Federal Reserve Bank of Philadelphia said Thursday that its index of factory activity fell to minus 5.8 from 8.5 in April. Any reading below zero indicates contraction. Measures of new orders and employment also fell in May, the bank said. That suggests manufacturers in the region are cutting jobs.
Among individual stocks, Japanese vehicle makers were hit hard. Yamaha Motor Co. tumbled 5 percent and Mitsubishi Motors Corp. was down 5.1 percent. Toyota Motor Corp. lost 3.7 percent.
Asiana Airlines Inc., South Korea’s second-largest carrier, plunged 5.1 percent after reporting that its earnings slid in the first quarter of 2012 from a year earlier, mainly due to soaring fuel prices, Yonhap News Agency said.
Gold miners were among the gainers. Australia’s Newcrest Mining rose 3.8 percent on rising prices for the precious metal. Hong Kong-listed Zijin Mining Group Co., China’s largest gold miner, rose 3.4 percent.
Benchmark oil for June delivery was down 1 cent to $92.55 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 25 cents to settle at $92.56 in New York on Thursday.
In currencies, the euro fell to $1.2686 from $1.2714 late Thursday in New York. The dollar rose slightly to 79.30 yen from 79.28 yen.
___
Follow Pamela Sampson on Twitter at http://twitter.com/pamelasampson
Apply for our overnight online cash advance loans from $100 to $2500, deposited instantly in your bank account.
Ben S. Bernanke warned last month that payroll gains might slow as companies adjust their labor needs for a period of moderate growth. Today
Be realistic when you ask borrow money using instant payday loans. Do not borrow more than you can afford to pay back, even if they offer you more money.
A $34 million lawsuit by Bank of America against Michael and Steven Roberts is the latest in a string of troubles facing the brothers.
The two former St. Louis aldermen built a business encompassing TV stations, hotel properties and other real estate developments across the country.
But that enterprise is under financial stress, hurt by the downturn in commercial real estate. The broadcasting arm is in bankruptcy, several real estate developments have stalled or been sold, and Missouri has sued their businesses over unpaid sales taxes.
It’s also not clear how the lawsuit might affect St. Louis city’s support for the brothers’ redevelopment project in the area around Kingshighway and Delmar Boulevard. The Roberts brothers are hoping to get $3.8 million in tax increment financing to help fund the $12.8 million retail project.
The latest fray happened Tuesday, when Bank of America filed a lawsuit in federal court alleging that the brothers defaulted on a loan used to renovate six hotels they own in five states.
The bank says Michael and Steven Roberts signed as guarantors on the loan, which totaled $43 million when issued in 2007. The Roberts brothers are each 50-percent guarantors on the loan, according to court documents.
Bank of America claims the brothers now owe $34.28 million in principal and $376,049 in interest on the loan to renovate hotels in Atlanta, Dallas, Houston, Shreveport, La., Spartanburg, S.C. and Tampa.
Michael and Steven Roberts did not return calls for this story.
In the lawsuit, the bank also alleges the Roberts brothers owe over $300,000 in unpaid real estate taxes on the hotels in addition to mechanics’ liens that haven’t been satisfied, putting them in breach of the terms of the loan.
According to a loan modification document, the Roberts brothers agreed to new loan terms in August 2011. The modification required the brothers to pay the delinquent real estate taxes on the hotels from 2009 and 2010.
However, the bank alleges the terms were not met, which triggered the lawsuit.
“Despite having notice of the events of defaults, defendants have failed to pay Bank of America their shares of the outstanding indebtedness overdue and owing under the guaranties and other loan documents,” the lawsuit states.
A Bank of America spokeswoman declined to comment on the pending litigation.
Several of the websites belonging to Roberts’ hotels boast of recent multimillion-dollar renovations that added deluxe bedding, flat-screen TVs and new furniture no faxing pay day loans. The hotels operate under several flags, including Holiday Inn, Marriott, Clarion and Crowne Plaza.
Michael Roberts is CEO of the Roberts Cos., a group of privately held businesses based in St. Louis that include hotels, condo developments and TV stations. His younger brother, Steven Roberts, is president.
The company’s real estate holdings include a $70 million condo tower in downtown St. Louis that sits empty more than two years after construction completed.
Another business, Roberts Broadcasting, filed for bankruptcy in October. Roberts Broadcasting owns four television stations: WRBU-Channel 46 in St. Louis, WZRB in Columbia, S.C.; WRBJ in Jackson, Miss.; and WAZE in Evansville, Ind.
It is seeking to sell some of the stations to satisfy debts. In the bankruptcy filing, Roberts Broadcasting lists more than $3.1 million in liabilities and $639,623 in assets.
In addition to its out-of-state properties, the hotel arm —Roberts Hotel Group — owns two hotels locally: the Roberts Mayfair Hotel at 806 St. Charles Street in downtown St. Louis and a Comfort Inn at 4630 Lindell Boulevard in the Central West End.
A year ago, the Central West End hotel stopped operating as a Hotel Indigo and ultimately switched to a Comfort Inn. And in January, the Mayfair left the Wyndham Hotels system and now operates independently.
“The separation was mutually agreed upon,” Wyndham Hotel Group’s spokeswoman Kathryn Zambito said in an emailed response to questions about the separation.
Last month, the state of Missouri filed two lawsuits against Roberts Cos. subsidiaries in St. Louis County Circuit Court, seeking back sales taxes on both local hotels. A spokesperson for the Missouri Department of Revenue declined to comment on the cases, but said a hearing is set for April 10.
The Roberts brothers also owned another hotel property locally, the former WS hotel at 400 Washington Avenue, that they had planned to turn into an extended stay hotel property. The brothers ultimately abandoned the plan and sold the property to another developer this year, Brian Hayden, who is converting it to apartments.
Italy
The services sector expanded at its fastest pace in a year in February, but new orders for factory goods dropped in January, data showed on Monday.
The Institute for Supply Management said its services index rose to 57.3 in February last month from 56.8 in January, besting economists’ expectations for a drop to 56.1.
It was the highest level for the index since February 2011 year in the services sector that accounts for about two-thirds of U.S. economic activity. A reading above 50 indicates expansion for the index.
The gauge of new orders improved to 61.2 from 59.4, while the employment index eased to 55.7 from 57.4.
“It was overall a solid report,” Tom Porcelli, chief U.S. economist at RBC Capital Markets in New York said, pointing specifically to the gain in the forward-looking new orders component.
“At this level of ISM, this is not really changing our view that you’re still looking at around a 2.0 percent year in terms of GDP, but it is holding up and this is certainly what you want to see.”
The prices paid index jumped to 68.4 from 63.5, suggesting that companies could start to be squeezed by higher input costs.
The resilience in the sector’s expansion was in contrast to data from the euro zone’s private sector earlier on Monday that showed Italian and Spanish businesses dragged the currency bloc back into decline last month cheap payday advance.
A separate report on Monday showed new orders for U.S. factory goods dropped in January by the most in over a year.
The Commerce Department said orders for manufactured goods fell 1.0 percent, not as much of a drop as the 1.5 percent decline economists were expecting. Still, it was the biggest decline since October 2010.
Financial markets saw little reaction immediately after the data as investors focused on China’s reduced economic growth target.
Both U.S. data points were consistent with an improving economy, said Joe Manimbo, market analyst at Western Union Business Solutions in Washington, D.C.
On factory orders, Manimbo said, “Despite the negative reading it was a little better than expectations and the prior number was upwardly revised, so again I think it’s consistent with the economy headed in the right direction.
With its testosterone-heavy marketing aimed at “young, hungry guys,” Hardee’s may seem like an unlikely user of Pinterest, a social media website that has become a popular place for women to find wedding ideas or to share pictures of shoes they covet.
But nonetheless, the St. Louis-based fast-food chain launched a Pinterest page a few weeks ago. The page now has boards full of everything from an homage to bacon to pictures of scantily-clad “Hardee’s hotties.”
“It is skewing very heavily female, which is not our demographic,” Jenna Petroff, Hardee’s spokeswoman, said of Pinterest. “But we’ve always been a brand that has been on the ground running with new technology. So we want to be there should our customers find their way there.”
There’s been a recent flurry of brands and retailers rushing to Pinterest, which is operated from Palo Alto, Calif., with less than two dozen employees, as buzz about the site has begun to bubble up into the mainstream. It’s a natural fit since retailers are interested in anything that helps inspire a desire for their products.
For the uninitiated, the site basically works like this: users create visual bulletin boards by uploading or “pinning” (tagging) pictures of things they want or find interesting.
While critics may wonder whether the Pinterest will be just another short-lived fad, data from the research firm comScore, which measures Internet traffic, shows that the site has been on an impressive growth trajectory.
The site’s numbers of visitors has grown about 55 percent in recent months and hit 11.7 million in January.
Pinterest is the fastest standalone site that comScore has tracked to hit the 10 million unique visitors, said Andrew Lipsman, the research firm’s vice president of industry analysis.
“It’s really showing an exponential growth curve at the moment,” he said.
Still, industry watchers aren’t sure how Pinterest plans to make money. Like many other social media startups, the site is figuring out a way to generate revenue and post a profit.
The website, which doesn’t charge users to sign up, is being funded by venture capital. On its site, Pinterest says it is looking at various possible funding methods in the future, such as advertising.
TARGET DEMOGRAPHIC
It’s not just Pinterest’s focus on products that are making many brands salivate. Women, who are a core consumer group for many companies, make up about 68 percent of Pinterest users and drive about 85 percent of page views, Lipsman said.
And when Pinterest users are spending some considerable time on the site — an average of 100 minutes a month, Lipsman added. (That compares to 400 minutes a month on Facebook and 20 minutes a month on LinkedIn.)
Another peculiarity of Pinterest is that it’s been predominantly a Midwestern phenomenon so far. One theory for that is the strong scrapbooking culture in this region.
“Typically, with a hot social media site, we see it take off on the coasts first,” Lipsman said. “But it’s been the exact opposite (with Pinterest). The coasts are under-represented and the Midwest is the highest indexing region faxless payday advance.”
Haim Mano, a marketing professor at the University of Missouri-St. Louis, said that companies have to be careful to not use social media, including Pinterest, just to blast their products.
They have to include some added content, too, otherwise people will zone it out, he said.
In any case, Mano added, “The younger generation are very savvy in understanding and realizing when this is a promotion created by a company or when it’s something that is consumer-generated.”
Jayme O’Renic, digital marketing manager for Overland-based Build-A-Bear Workshop, noted that some brands are merely pinning their entire catalog on Pinterest.
“But I think we’re making ourselves more authentic on Pinterest,” she said, noting the company has tagged everything from birthday party ideas to craft projects for St. Patrick’s Day. “We really want to be engaging with Mom.”
It’s a site that many Build-A-Bear’s customers are immersed in, she noted. For example, after the retailer recently launched new Kermit the Frog and Miss Piggy products, some users began immediately pinning the pictures to their Pinterest boards.
It’s hard to know whether Build-A-Bear has found new fans through the site, but O’Renic says it is surely driving some traffic to the company’s website.
Natalie Trivundza has been an avid Pinterest user herself and so decided a few weeks ago to launch a page for Phillips Furniture where she works as an advertising and marketing specialist.
“I love Pinterest myself for decorating ideas,” she said. “And our business is very visual. So I think it’s important for us to have a page because we’re design experts.”
When she first suggested that the company join Pinterest, she said many of her female co-workers were already familiar with the site.
“But all of the guys we work with had no clue what we were talking about,” she said.
Bill Elcan had been hearing the buzz about Pinterest for awhile, so finally decided to put Kirkwood-based Seeds of Happiness on it about a month ago.
The business, which is a little over a year old, makes and sells smiley faces out of lumps of clay.
“I know it’s one of the up and coming social media sites, so we might as well ride the wave,” said Elcan, the company’s president. “Right now we’re trying to grow our brand. This is just one more thing we can do to get in front of the public.”
He imagines that Facebook will continue to be the primary social media avenue for his business. But Pinterest can be another valuable outlet in the mix.
In addition to Facebook and Pinterest, he also manages Twitter, YouTube, Flickr, and LinkedIn accounts. And he recently launched a related blog. It can be a lot, especially for a small business where the president also runs the company’s social media pages.
“It’s a lot to think about and to manage,” he said. “But it’s worth it because it doesn’t really cost us anything.”
Diamond Foods Inc. is replacing its CEO and chief financial officer after an internal investigation found that the company improperly accounted for payments to walnut growers and it needs to restate two years of financial results.
The news, announced late Wednesday, sent shares of the San Francisco-based company plummeting more than 43 percent in after-hours trading.
Diamond Foods, which makes Emerald Nuts and Pop Secret popcorn, has been embroiled in a dispute over the payments for several months. The company said that its audit committee found that the payments were booked in the wrong period.
The payments _ an estimated $20 million in 2010 and $60 million in 2011 _ skewed the company’s financial results.
Diamond Foods placed its CEO Michael Mendes and Chief Financial Officer Steven Neil on administrative leave. The company is looking for permanent replacements. In the meantime, it appointed Rick Wolford, a Diamond Foods director and former CEO of Del Monte Foods, as its acting CEO. Michael Murphy, of Alix Parners, will serve as acting chief financial officer.
The deal could put Diamond Foods’ plans to acquire the Pringles brand from Procter & Gamble Co. in jeopardy. The deal, worth $1.5 billion when it was announced in April, would be the biggest acquisition ever for Diamond Foods and make it the second-largest snack maker in the nation behind PepsiCo Inc.
The collapse of Diamond Foods’ shares also hurts its ability to finance the deal.
Cincinnati-based P&G called the news from Diamond Foods “very disappointing.” It said in a statement that it is evaluating its next steps and keeping all its options open.
“Pringles remains a valuable asset and it has attracted considerable interest from other outside parties,” P&G said.
Shares of Diamond Foods were halted in trading earlier in the day but fell $15.88 to $20.78 in after-hours trading. Its shares have been on a downward slide since hitting $96.13 in late September.
Diamond Foods said it takes the integrity of its financial statements seriously and is working to complete the restatements as soon as possible.
Sales of previously owned homes rose to an 11-month high in December and the supply of properties on the market dropped to a near 7-year low, an
industry group said on Friday, pointing to a nascent recovery in the housing market.
The National Association of Realtors said existing home sales increased 5 percent month over month to an annual rate of 4.61 million units. November’s sales pace was revised down to a 4.39 million-unit pace, previously reported as a 4.42 million-unit rate.
Economists polled by Reuters had expected sales to rise to a 4.65 million-unit sales pace. Sales in December were up 3.6 percent from a year ago. A total of 4.26 million homes were sold in 2011, up 1.7 percent from the prior year.
The third straight month of gains in sales added to hopes that a tentative recovery in the housing market was starting take shape, but progress will be painfully slow given a glut of unsold properties that is weighing down on prices.
Payroll growth in the U.S. beat forecasts in December and the unemployment rate dropped to the lowest level in almost three years as the economy gained strength heading into 2012.
The 200,000 increase followed a revised 100,000 gain in November that was smaller than first estimated, Labor Department figures showed today in Washington. The jobless rate unexpectedly fell to 8.5 percent, while hours worked and earnings climbed.
Record drought ravaged parts of Texas and Oklahoma this year, but Missouri was hard hit, too — and now the state’s dairy and cattle industries are scrambling to cope with the aftereffects of the parched summer as they prepare for winter.
“We’ve heard an awful lot about the extreme drought in Texas and Oklahoma, and areas farther west,” said Mike Collins, a professor of plant science at the University of Missouri. “But if you look at the drought map, it projects into Missouri.”
Last month, in fact, the U.S. Department of Agriculture designated 101 Missouri counties natural disaster areas because of the drought, and one estimate puts the loss to the state’s grain farmers at nearly $350 million. University of Missouri researchers say the state would need to get an unlikely 13 feet of snow this winter to compensate for the scorching heat and lack of rain that shrank crop yields last summer.
“In mid-Missouri and particularly as you go southwest, (the soil) was pretty well depleted four to six feet down. There’s not much left there for plant growth,” said Randy Miles, a soil scientist with the university. “We need to recharge the piggy bank, so to speak.”
The drought’s impact is reaching into all areas of agriculture, and could eventually hit consumers. Corn farmers in Missouri lost roughly 24 million bushels of yield because of the drought, and the state’s soybean farmers about 20 million. The drought also scorched pasture and forage lands, and now, hay — a newly precious commodity — has been heading out of state by the truckload.
“We see a lot of hay moving east to west,” Collins said. “A lot of hay heading west on the interstate.”
Missouri is the country’s third-largest producer of hay, but this year hay is in such great demand from cattle and dairy farmers in neighboring states that producers, here and elsewhere, are scrambling to secure enough of it to make it through the winter.
“I had to drive 100 miles north, to get it from a guy in Green Ridge,” said Darrel Franson, a cattle farmer who heads the Missouri Forage and Grassland Council. “In the half an hour I’m talking to him, his phone rings three times, with producers from Texas willing to buy anything he’s got, at any price.”
Cattle ranchers and dairy farmers typically grow much of the hay they feed their animals. But this year, burned-up pasture land forced them to feed hay months before they typically would. At the same time, the weather shrank hay yields by as much as 15 to 30 percent in some places.
Some worry that, by mid-winter, producers will be caught without enough to feed their animals.
“In January or February, the farmer is going to take a walk out into his pasture and see his cows are thin. He’s going to run in and say, ‘Ma, the cows are awful thin.’ Then they’re going to look at the ground and see there’s no grass there,” Franson said. “They’re going to get on the phone to get some hay, and they won’t find any.”
DAIRY FARMER FEARS
The situation is not just a question of scarcity, but of quality. Hay that survives the weather isn’t the most nutritious, which means cows need more of it. Dairy cows, particularly, need better-quality hay to produce better milk, and for the higher-quality hay, producers are paying as much as $300 a ton.
“That’s well above what we normally see,” Collins said.
The state’s dairymen are especially concerned.
“This is going to be one of the toughest challenges I’ve seen in my lifetime, seeing these cows through the winter,” said Larry Purdom, head of the Missouri Dairy Association. “A lot of times in the past when hay prices were up, we could use corn, but that’s been at record highs, and that’s expensive now, too.”
The state’s dairy herd has shrunk to about 90,000 from 100,000 in recent years, Purdom said, and could get even smaller as aging dairy farmers decide to sell their cows and get out of the business rather than face higher feed costs.
“This is serious,” Purdom said. “We have eight or nine processing plants in the state, and if we don’t have milk for them, we’re worried they’ll take their operations somewhere else, and that means jobs.”
Cattle ranchers, too, are being forced to pay higher feed prices, and some are selling off their animals.
“I sold 20 percent of my herd,” Franson said. “I have to match up my cattle with my forage supply.”
Cattle ranchers, however, are still in the black, with high beef prices buoyed by demand overseas and a shrunken American cattle population.
“Given where prices are today, producers are trying to take advantage of that,” said Jeff Windett, of the Missouri Cattlemen’s Association.
So are the state’s hay producers. “Anytime you have a situation like this, it makes it difficult for some,” Collins said. “But for farmers in the business of producing hay, this is an excellent year.”
Researchers at the University of Missouri and the states’ farmers, however, are worried about next year. If soil moisture isn’t adequately replenished over the winter months, farmers could face depleted soils for a second year. That puts farmers in an odd situation: Hoping for a bad winter.
“If we don’t get enough input over the next few months, we could go into the next season without enough moisture,” Miles said. “Even though it might not be that amenable to some, and it may create some slushy driving hazards and so on, from a soil moisture viewpoint, more snow and rain may be more valuable long term.”
Powered by WordPress -- XHTML 1.0