US stock prices fell sharply at Friday's opening bell, as the Commerce Department released a disappointing report on second-quarter economic growth, but partially rebounded later in the session. All three indexes finished lower, to cap off their worst week in about a year. The markets also continued to be pressured by the ongoing debate in Washington over raising the nation's debt limit.
Consumer sentiment plunged to its lowest level since March 2009 in July, with outlooks dimming on current and future economic conditions, according to the Thomson Reuters / University of Michigan consumer sentiment index, released Friday. The measure dropped from a reading of 71.5 in June to 63.7, slightly lower than the index's preliminary reading of 63.8. Economists taking part in a recent MarketWatch survey had expected a final reading of 64.3.
New NASA satellite data shows that the Earth's atmosphere may have been allowing more heat to release into space than scientists had believed, bringing the accuracy of many global warming computer models into question. A study published in the science journal Remote Sensing outlines the research, indicating that far less global warming will occur than United Nations-sponsored computer models have indicated.
Groupon announced this week it has agreed to a partnership with Foursquare to offer its daily deals through Foursquare's mobile application, giving Groupon yet another way to sell its popular daily discount offers. Foursquare is a mobile locations-based social platform that allows users to “check in” with local restaurants and other businesses with their smartphones and share their whereabouts with friends.
According to new data released on Friday, the Great Recession was even worse than previously estimated. The data showed that economic contraction during the 2007 – 2009 downturn, the nation's worst since the 1930s, occurred at a rate of 5.1 percent instead of 4.1 percent. The report also showed that we came perilously close to another recession in the first quarter of this year, as economic growth for the period was revised down to just a 0.4 percent annual pace.
Goldman Sachs Group has experienced something of a mass exodus in recent months as more than a dozen traders have resigned from its North American government bond and derivatives trading desk in New York. The departures are presumably due to the investment bank shying away from risk, leading to fewer bonuses for active traders.
Starbucks Corp released its fiscal third-quarter results after Thursday's closing bell, making investors very happy with a 34 percent rise in profits. Despite weakness in many sectors of the American economy, the world's largest coffee chain said more people are coming in to its stores, and spending more while they're there. The company also raised its full-year forecast based on recent trends, sending its shares higher in after-hours trading.
According to the latest statement from the US Treasury, the government now has a lower cash balance than Apple Corp, the Cupertino, California-based tech giant that makes iPhones and iPads. According to its latest earnings report, Apple had a total of $76.2 billion in cash and securities at the end of June, while the government, according to Treasury's report, has a current operating balance of $73.8 billion. Maybe the US should divert the focus of NASA, who should have some time on its hands with the ending of the shuttle program, to developing a new smartphone or tablet computer.
Chevron Corp. released second-quarter results Friday, posting a 43 percent surge in profits compared to 2010's second quarter as higher oil prices helped improve refinery margins and helped offset a drop in output. The results exceeded the expectations of analysts. Chevron is just the latest company to report higher earnings as the oil industry continues to take advantage of the highest oil prices in three years.
The Commerce Department reported on Friday that US GDP growth slowed in the second quarter as consumer spending slowed, as did the the spending of state land local government. The economy grew at an annualized rate of 1.3 percent during the period, the report showed, much lower than what economists were expecting. The report dealt another blow to the economic outlook with a revision of first quarter GDP growth from 1.9 percent all the way down to 0.4 percent. Combined, the data show that the US economy expanded at a slower pace in the first half than at any other time since the recession ended.