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Stocks fall after weak retail sales
NEW YORK—A surprisingly weak retail sales report drove stocks lower yesterday, giving the Dow Jones industrial average its second straight day of losses. The Commerce Department said yesterday that retail sales rose just 0.3 per cent in January, the smallest increase since June and half of what economists had predicted. Kim Caughey Forrest, equity research analyst at Fort Pitt Capital Group, said higher prices for gasoline and raw materials are beginning to be passed along to consumers. That’s hurting retail sales and spending, she said.
“Without wage gains,” she said, “people are going to buy less.” Energy companies led the way down. Exxon Mobil Corp. lost 2.3 per cent, the largest drop among the 30 large companies that make up the Dow. Exxon Mobil said it added 3.5 billion barrels of oil and gas last year to the company’s massive reserves, more than twice what Exxon produced in 2010. The Dow fell 41.55, or 0.3 per cent, to close at 12,226.64. That’s only the third day this month the Dow has closed lower.
The Standard & Poor’s 500 index fell 4.31, or 0.3 per cent, to 1,328.01. The Nasdaq composite index fell 12.83, or 0.5 per cent, to 2,804.35. The parent company of the New York Stock Exchange agreed to combine with the operator of the Frankfurt stock exchange, Deutsche Boerse AG, creating the world’s largest financial markets company. Shares of both companies fell after the deal was announced. NYSE Euronext’s shares lost 3.4 per cent in New York, while Deutsche Boerse’s lost 2.4 per cent in Frankfurt.
One of NYSE’s biggest competitors, Nasdaq OMX Group Inc, fell 4.6 per cent. Limelight Networks Inc jumped 27 per cent after the provider of streaming video services narrowed its fourth-quarter loss and issued a better-than-expected forecast for the current quarter. The company is benefiting from consumers turning to the Internet to watch television and movies; one of its customers is online video company Netflix Inc. (AP)
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