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U.S. stocks post modest losses after the open; Dow Jones sheds 0.04%

Published 02/02/2011, 09:55 AM
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Investing.com – U.S. stocks posted modest losses after the open on Wednesday, a day after closing at the highest level in 28 months, as a string of downbeat corporate earnings results overshadowed better-than-expected U.S. employment data.

During early U.S. trade, the Dow Jones Industrial Average shed 0.04%, the S&P 500 index slumped 0.15%, while the Nasdaq Composite index dipped 0.10%.

Earlier in the day, payroll processing firm ADP said non-farm private employment rose by a seasonally adjusted 187K in January, after rising by a revised 247K in December, beating expectations for an increase of 150K.

Meanwhile, shares in the world’s largest home appliance maker Whirlpool dropped 4.89% after it reported fourth quarter earnings of USD171 million, falling short of expectations for earnings of USD191 million. The company said that sales in North America dipped 1% to USD2.6 billion.

Shares in pharmaceutical giant Hospira tumbled 9.14% after it said that its fourth quarter profit plunged 37% to USD60.6 million, compared to USD96.7 million a year earlier. Revenue in the quarter declined 6% to USD992.1 million, as margins tightened and research costs rose.

Elsewhere, shares in semiconductor manufacturer Broadcom sank 7.91% after Citigroup downgraded the stock, citing worries about rising operating expenses.

Also Wednesday, the second largest U.S. bookstore chain Borders saw shares plummet 25.53%, following media reports that the company may file for bankruptcy as soon as next week.

However, shares in the second largest U.S. video-game maker Electronic Arts rallied 13.3% after it announced a better-than-expected earnings outlook for the current quarter as well as a share-buyback plan worth USD600 million.

The world's second largest entertainment conglomerate Time Warner saw shares add 4.32% after it reported fourth quarter net income jumped by 22% to USD769 million. Revenue in the quarter rose by 8.5% to USD7.81 billion, beating expectations for revenue of USD7.47 billion.

Meanwhile, shares in the largest U.S. chocolate producer Hershey saw shares climbed 1.76% after announcing a 9% increase in fourth quarter profit to USD135.5 million, as results were boosted by strong holiday sales and accelerated growth in emerging markets.

Across the Atlantic, European stock markets were mixed. The EURO STOXX 50 shed 0.11%, France’s CAC 40 dipped 0.34%, Germany's DAX was down 0.07%, while Britain's FTSE 100 climbed 0.46%.

Earlier in the day, German Deputy Finance Minister Joerg Asmussen rejected the idea of creating a euro-zone bond and reaffirmed that revisions to the existing euro-zone fiscal rescue facility were likely to require concessions from governments, such as deficit reduction.

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