The Enid News and Eagle, Enid, OK

National and world

November 16, 2012

Stocks slip as Ding Dongs and Dell make news

OKLAHOMA CITY — Stock indexes edged lower on Wall Street Friday. Dell, the personal computer maker, and J.M. Smucker, a food maker, fell after their earnings reports disappointed investors.

The Dow Jones industrial average was down 65 points at 12,477 as of 11:30 a.m. EST. The Standard & Poor's 500 index was down nine points at 1,344. The Nasdaq composite was down 24 points at 2,813.

Hostess Brands Inc., the maker of Twinkies, Ding Dongs and other snacks, says its going out of business after striking workers across the country crippled its ability to supply retailers with its products. The company, which isn't listed, said the closing would mean the loss of about 18,500 jobs.

Dell fell 75 cents to $8.81 after saying that its revenue may fall as much as 13 percent in the fourth quarter. Dell is suffering as consumers switch away from PCs to less expensive smartphones and tablets. J.M. Smucker fell $2.65 to $82.73 after its sales forecast for the company's fiscal year disappointed investors.

Investors will also watch for any developments regarding the "fiscal cliff," as President Obama heads into budget negotiations with congressional leaders Friday.

Stocks have fallen steadily since voters returned President Barack Obama and a divided Congress to power Nov. 6. The Dow has lost 5 percent since election day. Investors are worried that U.S. leaders may not reach a deal before tax increases and government spending cuts take effect Jan. 1. The impact would total $700 billion for 2013 and could send the country back into recession.

"There's just a continuation of the sell-off as uncertainty persists," said Todd Salamone, of Schaeffer's Investment Research in Cincinnati, Ohio. Salamone says stocks will likely rally if there is a timely resolution to negotiations, as investors put their "firepower" to work.

The Dow is heading for its fourth straight weekly loss, while the S&P 500 is on track for its third losing week out of the last four.

Superstorm Sandy depressed U.S. industrial output in October, while production of machinery and equipment declined sharply, reflecting a more cautious outlook among businesses, according to a Federal Reserve report.

The Fed says industrial output fell 0.4 percent last month, after a 0.2 percent gain in September. Excluding the storm's impact, production at the nation's factories, mines and utilities would have been up about 0.6 percent.

Among other stocks making big moves:

— Schiff Nutrition International Inc., a nutritional supplement company, jumped $9.75 to $43.68 after U.K.-based Reckitt Benckiser Group offered to pay $42 a share in cash to buy the company.

— Ruckus Wireless Inc., a maker of wireless networking equipment, dropped 45 cents to $14.57 on its first day of trading. That's a decline of 3 percent.

 

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