Bookseller Barnes & Noble saw its shares surge more than 50 percent on Monday after a joint announcement that Microsoft has agreed to invest $300 million in the company's Nook e-book and e-reader business. The deal will not only increase the value of the fast-growing Nook business, but also gives Microsoft its first substantial presence in the sector. Under the terms of the deal, announced early Monday morning, Microsoft will take a 17.6 percent stake in the Nook unit, which will gain $300 million in cash to use in its ongoing battle for market share with Apple's iPad and Amazon's Kindle.
Humana Inc. issued its first-quarter results Monday, posting a 21 percent slide in net income as an increase in insurance claims outpaced a gain in revenue and the company also increased capital spending in preparation for expected membership growth in its lucrative Medicare Advantage program. The insurer also raised its expectations for earnings for the full year, however, from a previous forecast of $7.50 to $7.70 per share to $7.55 to $7.75 per share. Earnings and the forecast were short of Wall Street expectations, however, leading to an 8 percent slip in the company's shares in early trading on Monday.
LDK Solar Company posted its fiscal fourth-quarter results Monday, posting a net loss due o slumping demand and prices for solar-related products that saw the company's revenue decline by about 50 percent and drove the company's gross margins into negative territory. The solar industry has been struggling over the last few years as an oversupply of solar panels caused by government subsidies offered to those who produce them has driven prices down substantially. In addition, demand has been weakened by economic weakness in Europe, the world's largest market for solar products.
According to a report published in the New York Times over the weekend, tech-giant Apple Inc. used a number of legal tax loopholes to avoid paying millions of dollars in taxes in the US, and billions worldwide, to which Apple responded that it pays an enormous amount of taxes, and follows all the lax laws in every market in which it does business. According to the NYT piece, the world's most valuable company by market cap paid $3.3 billion in taxes globally in 2011 on total profits of $34.2 billion, giving the company an effective tax rate of 9.8 percent. About 30 percent of the company's earnings were earned in the US market.
The US Commerce Department reported Monday that consumer spending slowed in March despite an increase in incomes in the world's largest economy. The report showed that spending rose by 0.3 percent, a third of the 0.9 percent increase in February, and below the 0.5 percent increase expected by economists in a recent Bloomberg survey. When inflation is factored in, spending growth was even slower, at just 0.1 percent. Personal incomes, meanwhile, increased by a slightly higher 0.4 percent during the month, double the 0.2 percent increase in spending from the prior month.
US stocks posted solid gains on Thursday as positive remarks from Fed Chairman Ben Bernanke on Wednesday and an increase in pending US home sales combined with a drop in unemployment claims offset a batch of mixed corporate earnings. Bernanke said Wednesday that the economic recovery is moving along at this point, but that the central bank is sitting at the ready to take further stimulus action if needed. Jobless claims edged up by a thousand over the previous week, and pending home sales rose 13 percent year-over-year.
Exxon Mobil issued its first quarter results Thursday, posting an 11 percent slide in profit as the world's largest oil conglomerate suffered weak results in its chemical and refining arm and a slowdown in production. The disappointing results mark Exxon's first slide in net income since late 2009, when oil prices slumped sharply at the height of the recession.
Initial jobless claims fell by 1000 to 388,000. Last month employers added 120K new jobs, which is the least since October 2011. The 4-week moving average for new claims rose to 381,750, higher than it has been since early January 2012.
US stocks posted solid gains on Wednesday after Federal Reserve Chairman Ben Bernanke issued a surprisingly upbeat update on the economy. Investors welcomes Bernanke's comments but were also encouraged by a series of mostly upbeat corporate earnings reports from companies including Apple, Boeing, and Delta Airlines, among others. All three major US indexes began the day trading sharply higher, but backed off slightly leading up to Bernanke's address, which sent them back up to post session highs late in the day.