- The Washington Times - Wednesday, April 15, 2009

NEW YORK (AP) - Wall Street is moderately lower in early trading following signs the economy is still struggling.

Investors are unnerved by Intel Corp.’s decision not to provide detailed forecasts for future quarters. And mixed economic readings are adding to investors’ jitters.

Traders are worrying that a five-week rally in stocks from early March might have been overdone given the latest signs that the economy still faces big obstacles as it tries to stabilize.

In the early going, the Dow Jones industrial average is down 42 at 7,876. The Standard & Poor’s 500 index is down 5 at 836, and the Nasdaq composite is down 17 at 1,609.

THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

NEW YORK (AP) _ Wall Street is poised for a modestly lower opening Wednesday amid fresh signs the economy is still struggling.

After the market closed Tuesday, Intel Corp. announced first-quarter profit that easily beat analysts’ expectations, and the chipmaker said slumping computer sales are bottoming out.

But, investors were uneasy that Intel did not provide detailed earnings guidance for future quarters, sparking worries a turnaround in the economy might not occur anytime soon.

Adding to the economic anxiety, the government announced before the market opened that consumer prices slipped 0.1 percent in March. Economists had been expecting a 0.1 percent rise in the key inflation indicator.

The stock market stumbled on Tuesday after the government said retail sales declined 1.1 percent in March even as analysts expects a small rise. Retail sales are used as a barometer for consumer spending, which accounts for about two-thirds of U.S. economic activity.

Ahead of the opening bell Wednesday, Dow Jones industrial average futures fell 13, or 0.16 percent, to 7,871. Standard & Poor’s 500 index futures fell 1.9, or 0.23 percent, to 838.40, while Nasdaq 100 index futures declined 10, or 0.76 percent, to 1,314.00.

In a sign of further weakness in the economy, Internet firm Yahoo Inc. and European bank UBS AG both are cutting jobs.

Yahoo is planning to cut several hundred jobs in its third round of layoffs in 14 months, a person familiar with the plans said. Details of the cuts are unlikely to be released before the Sunnyvale, Calif.-based firm announces first-quarter earnings report Tuesday.

Switzerland-based UBS said it will cut 8,700 jobs worldwide by the end of next year. UBS announced the job cuts as it said it expects a first quarter loss of nearly 2 billion Swiss francs ($1.75 billion).

The UBS results put a damper on improving bank earnings that were seen at Wells Fargo & Co. and Goldman Sachs Group Inc. Both Citigroup Inc. and Bank of America Corp., among the hardest hit by the credit crisis, report first-quarter results later this week.

“We’re going to continue to get bad news,” said David Hefty, chief executive of Cornerstone Wealth Management in Auburn, Ind. Hefty noted though, that investors are less swayed right now by actual fundamentals in the economy and more by the momentum of the market.

Investors will get further clues about current economic conditions when the Federal Reserve releases its beige book, which provides insights into regional economic conditions. The beige book report is scheduled to be released at 2:00 p.m. EDT.

The Fed also releases a report on industrial production Wednesday morning. The Fed is likely to indicate industrial output fell for a fifth straight month in March amid the ongoing recession.

Meanwhile, bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.78 percent from 2.79 percent late Tuesday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.17 percent from 0.16 percent late Tuesday.

The dollar was mixed against other major currencies, while gold prices rose.

Overseas, Japan’s Nikkei stock average fell 1.1 percent. In afternoon trading, Britain’s FTSE 100 fell 0.4 percent, Germany’s DAX index declined 0.5 percent, and France’s CAC-40 fell 0.3 percent.


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