U.S. Stocks Fall as Alcoa Slumps Amid Earnings Concern (Bloomberg)
U.S. stocks continued slipping as the Standard & Poor’s 500 Index dipped for a fourth straight day. “The fear is that this is going to be a really bad earnings season,” said Hank Smith, chief investment officer at Haverford Trust Co. in Radnor, Pa.. Alcoa (AA), the first member of the Dow Industrial Average to announce results, lost 4.6% to $8.71. The company cut its forecast for growth in aluminum consumption this year to 6%, down from 7%, as demand from China weakens. Alcoa ironically reported third-quarter earnings and sales that beat analysts’ projections.
Jamie Dimon is Mad at Washington (CNNMoney)
The outspoken CEO of the country’s third-largest bank, JPMorgan Chase, lashed out on Wednesday at the Obama administration and Congress for their handling of a number of issues, including the fiscal cliff and a recent federal lawsuit. Dimon, speaking Wednesday at the Council on Foreign Relations in Washington, said his bank has put together a “war room” to prepare for the so-called fiscal cliff. “I just think it’s terrible policy to let us get close,” Dimon said. Dimon squarely blamed Washington for the friction between business and the nation’s capital.
U.S. Growth Remains Modest, Fed Says (MarketWatch)
“Reports from the twelve Fed districts indicated that economic activity generally expanded modestly since the last report,” the Fed said in its Beige Book. Most sectors of the economy were improving, at least slightly, according to the report. The better tone didn’t do much to help the U.S. stock market on a down day.The Beige Book was prepared by the New York Fed based on thousands of comments from businesses and other contacts in the 12 regions through Sept. 28. The Beige Book is prepared to guide policymakers at their meeting on Oct. 23 and Oct. 24.
Wall Street Still Spooked by Spain (CNNMoney)
The European Central Bank (ECB) may be trying to do “whatever it takes” to save the euro, but Wall Street remains uneasy about Europe’s future and its nearly three-year-old debt crisis. The yield on the 10-year Spanish bond has dropped below 6% from 7.8% earlier this summer, but rates could spike just as quickly. Spanish banks are facing a shortfall of more than €59 billion ($76 billion), and most experts agree that it’s just a matter of time before the cash-strapped country will be forced to request a bailout from the ECB. Given how closely tied European debt markets are, a spike in Spain’s bond yields could also spell trouble for other countries in Europe, particularly Italy, said Marc Pado, U.S. market strategist at DowBull.