US FINANCIAL MARKET
U.S. Stocks Fall at the Open amid Earnings, Mounting Global Tensions
- Geopolitical tensions kept investors on the sidelines before major companies report earnings.
- Reynolds American dropped 1.7 percent after a jury ordered a unit of the company to pay a Florida woman $23 billion for her husband’s death from lung cancer.
- Halliburton gained 1.5 percent after reporting that second-quarter revenue topped estimates.
- EMC rallied 4.3 percent to $28.13 after the Wall Street Journal reported that Elliott Management bought a stake in the maker of storage computers for more than $1 billion.
- The S&P 500 rallied 1 percent on July 18, rebounding from its biggest loss since April 10 that came after the downing of a Malaysian Airlines passenger jet in Ukraine and the Israeli ground invasion of the Gaza Strip.
- European Union foreign ministers meeting in Brussels tomorrow will consider tougher sanctions on Russian individuals and companies.
- About 76 percent of S&P 500 companies that have posted results this season have beaten analysts’ estimates for profit, while 68 percent exceeded sales projections so far.
Reynolds Must Pay $23 Billion Smoker Verdict Likely to be Cut
- A Reynolds American unit was ordered by a Florida jury to pay a Pensacola woman $23 billion in punitive damages for her husband’s death from lung cancer, her lawyer said.
- Since a Florida Supreme Court decision in 2006, individual plaintiffs in the state have been awarded large verdicts, with most of those being reduced on appeal.
Gilead Drug Combination Cures Hepatitis C in HIV Patients
- In a study of 223 HIV-infected patients, Gilead Sciences’ Solvadi cleared the most common U.S. strain of hepatitis C in 76 percent of newly treated patients over 24 weeks.
- Only seven participants stopped treatment because of side effects and there were no adverse effects on HIV treatment.
- The high cost of Sovaldi has come under scrutiny from U.S. lawmakers and U.K. regulators.
- The 12-week course of treatment would be $94,500 and the 24-week course $189,000, according to Saag’s editorial.
Google May Transform NYC Pay Phones Into Wi-Fi Hot Spots
- Google is among several technology companies considering a plan that uses pay-phone locations to give New Yorkers free wireless Internet access.
- There are more than 7,300 pay phones in the city.
Yum and McDonald’s apologize as new China food scandal brews
- Chinese regulators shut a local meat supplier following a TV report that showed workers picking up meat from a factory floor, as well as mixing meat beyond its expiration date with fresh meat.
- The firms said they’ll stop using the supplier.
Halliburton sees North America margin growth on rise in drilling
- The world’s No.2 oilfield services provider expects higher margins in North America due to strong drilling activity and is signaling an industry-wide recovery in the region after a two-year slump.
- Halliburton said that it expects North America margins to touch 20 percent in the third quarter.
- Its margins in the region rose 2.8 percentage points to 18.2 percent in the second quarter, and were higher than Baker Hughes’ 12 percent and Schlumberger’s 18 percent for the same period, according to analysts.
- Net income rose 20 percent to $774 million in the quarter, meeting Wall Street’s expectations.
- Revenue rose 10 percent to $8.05 billion, beating the average analyst estimate of $7.88 billion
Tiffany CEO Kowalski to retire, president Cumenal to take over
- Kowalski, 62, has been with Tiffany for over three decades. He became chief executive in 1999 and assumed the role of board chairman in 2003.
CBS Outdoor buys Van Wagner billboard unit for $690 million
- Van Wagner Communications has outdoor advertising in New York’s Times Square and buses on the Las Vegas strip.
- CBS Outdoor has customers include Apple, McDonald’s, and Sony and went public in late March after it was spun off from CBS.
Tesco ditches CEO for Unilever man after profit warning
- Clarke, who has spent more than 1 billion pounds ($1.7 billion) on a failed recovery plan in Tesco’s main home market, will be succeeded on Oct. 1 by Dave Lewis.
- The darling of the retail sector during two decades of uninterrupted earnings growth, Tesco started losing ground in the UK in the final years of long-standing CEO Terry Leahy’s tenure.
US ECONOMY & POLITICS
NABE survey points to rising U.S. wage pressures
- The National Association for Business Economics’ (NABE) latest business conditions survey found that 43 percent of the 79 economists who participated said their firms had increased wages.
- That compared to only 19 percent last year and marked an increase from 35 percent in the three months to April.
- It was the first time since October 2012 that no respondents reported declining wages at their firms.
- The share of businesses increasing employment jumped to 36 percent in the July quarter from 29 percent a year ago. That was up from 28 percent in the April quarter.
EUROPE & WORLD
Putin Says MH17 Crash Shouldn’t Be Used for Politics
- As leaders from London to Washington signaled Putin risks becoming a pariah, the Russian leader suggested they were playing politics.
- A total of 282 bodies have been found, the Ukrainian government said today.
- Putin again blamed the downing of the plane on the Ukraine conflict and said that international investigators should have full access to the wreckage. Russia will “do everything it can” to seek a negotiated settlement of the Ukraine conflict, he said.
TODAY in HISTORY
- The first train robbery west of the Mississippi was pulled off by Jesse James and his gang (1873)
- The U.S. Senate ratified the North Atlantic Treaty (1949)
- WorldCom filed for bankruptcy, the largest bankruptcy in U.S. history (2002)
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