A handful of bleak profit forecasts and more evidence of escalating unemployment unnerved investors today, sending stocks down sharply.
A handful of bleak profit forecasts and more evidence of escalating unemployment unnerved investors today, sending stocks down sharply.
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All the major indexes lost more than 1.5 per cent, including the Dow Jones industrials, which tumbled about 175 points. Underscoring investors' fears that 2009 is shaping up to be a difficult year for many sectors, Time Warner and Intel today issued disappointing numbers.
Time Warner Inc said it expects to record a fourth-quarter USD 25 billion impairment charge for its cable, publishing and AOL units that will lead to an operating loss for the period and a loss for the full year.
It had expected a profit between USD 1.04 and USD 1.07 per share for the year. Meanwhile, computer chip maker Intel Corp said it expects fourth-quarter revenue to drop 23 per cent, below prior estimates, due to weak demand and inventory reductions by its computer maker customers.
Time Warner shares shed 63 cents, or 5.8 per cent, to USD 10.35. Intel fell 60 cents, or 3.9 per cent, to USD 14.77. Aluminium producer Alcoa Inc's decision to slash jobs further jolted investors.
Alcoa said late yesterday it is reducing its global work force by about 13,500, or 13 per cent, by the end of the year and lowering total output by more than 18 percent annually. Alcoa tumbled USD 1.05, or 8.7 per cent, to USD 11.07.
The announcement comes ahead of the Labour Department's report Friday on the job market, a closely watched barometer of the economy's health.
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