US stocks fell on concern slowing economic growth may deepen the slump in shares of computer-related and telephone companies, the year's biggest losers. The Standard & Poor's 500 Index dropped for the seventh week in eight. \n"I don't think there's confidence built in that the economy has turned the corner and that we're going to see the earnings," said William Dwyer, who oversees US$8 billion as chief investment officer at M&T Asset Management in Buffalo, New York. \nMicrosoft Corp was the biggest drag on benchmark indexes after antitrust regulators in Europe said their concerns are "considerably" different from those in the US. \nThe S&P 500 fell 18.02, or 1.7 percent, to 1,054.99, with technology companies including Intel Corp and telephone stocks such as SBC Communications Inc contributing 42 percent of the drop. The Dow Jones Industrial Average slid 97.50, or 1 percent, to 9,939.92. The NASDAQ Composite Index slumped 49.64, or 3 percent, to 1,600.85. \nThis week, the S&P 500 lost 1.7 percent as investor optimism triggered by better-than-expected earnings at Cisco Systems Inc was tempered after Wal-Mart Stores Inc. posted weaker-than-forecast sales. \nThe Dow dropped 0.7 percent and the NASDAQ slid 0.8 percent, wiping out Wednesday's 7.8 percent rally. \nThe three indexes have all declined this year, paced by the NASDAQ's 18 percent loss. \nAll 10 industry groups that make up the S&P 500 fell as a survey showed the economy is likely to slow this quarter. Growth will probably pick up little in the second half, according to today's Blue Chip Economic Indicators survey. \nThis month's poll of 51 economists forecasts the economy will expand at a 3.3 percent annual pace in the third quarter, down from a consensus of 3.6 percent last month. \nFirst-quarter earnings for companies in the S&P 500 fell 12.3 percent, their fifth straight drop, according to Thomson First Call. Analysts expect profits will increase 14.5 percent for 2002, though that estimate has been trimmed almost 2 percentage points the past month. \n"We'll have to wait for the end of the year to see some recovery," said Tom Walker, head of US equities at Martin Currie Investment Management in Edinburgh, which oversees about US$10 billion. He sold shares of Cisco on Wednesday after they soared 24 percent. \nSome 1.17 billion shares traded on the New York Stock Exchange, down 11 percent from the three-month daily average. \nAlmost two stocks declined for every one that gained on the Big Board. \nAll 13 members of the S&P index of phone service companies fell. The group lost 3.7 percent, extending the decline this year to 32 percent. Investors are concerned repaying billions of dollars in debt issued to fuel acquisitions and build networks may get more difficult because of overcapacity and falling prices. \nSBC Communications lost US$0.90 to US$30.45 and Verizon Communications Inc dipped US$0.80 to US$39.35. \nQwest Communications Inc dropped US$0.86 to $5.04 after saying it will take longer to pay sales commissions to lower expenses. The fourth-biggest local-phone company has a US$3.39 billion bank loan due at year's end. \nWorldCom Inc tumbled US$0.43 to US$1.58 a day after US$32 billion of its debt was downgraded to junk by Moody's Investors Service. The second-biggest long distance phone company has plunged 89 percent this year. \nWestern Wireless Corp plunged US$2.33 to US$3.35 after the provider of mobile-telephone service in 19 western US states said its first-quarter loss widened as US sales fell. \nMicrosoft lost US$2.07 to US$50.05. The Financial Times said the software maker faces sterner measures than in the US to address antitrust concerns of European Competition Commissioner Mario Monti. \nAll 17 members of the Philadelphia Semiconductor Index dropped as the benchmark declined 4.5 percent. Chip-equipment maker KLA-Tencor Corp lost US$3.10 to US$54.40, while Novellus Systems Inc fell US$2.72 to US$46.30. Intel, the largest chipmaker, fell US$1.23 to US$27.01. \nFinancial companies slumped after Standard & Poor's cut Credit Suisse Group's credit rating on concern about the company's high costs and limited profit growth. \nCitigroup Inc fell US$1.03 to US$43.30 and Morgan Stanley Dean Witter & Co dropped US$1.53 to US$46.97. JP Morgan Chase & Co fell US$0.69 to US$35.08 and Merrill Lynch & Co declined US$1.38 to US$41.53. \nReliant Resources Inc tumbled US$2.49 to US$12 after saying it may have inflated trading volume by selling and instantly repurchasing electricity. The biggest power company in Texas canceled a US$500 million bond sale because it did not disclose trades that may have boosted the size of its business. \nUS Airways Group Inc declined US$1.35 to US$3.60, leading airlines lower, after the seventh-largest US carrier said it may seek bankruptcy protection unless the company receives financing backed by a federal loan guarantee. United Airlines parent UAL Corp slumped US$2 to US$9.50 and Boeing Co, the largest planemaker, slipped US$1.35 to US$43.63. \nWhile stocks may languish in coming weeks, now may be a good time to buy, some investors said. \n"The haze is going to clear over the next couple of months, and the recovery will appear fairly firm by the third or fourth quarter," said Bill Knapp, head of global investment strategy at Citigroup Asset Management, which manages US$455 billion. \nKnapp recommends diversified financial shares and industrial companies as most likely to gain in coming months. With the S&P 500 down 9 percent since mid-March, "it's probably a moderately undervalued market right now."
* The S&P 500 fell 18.02, or 1.7 percent, to 1,054.99.
* The NASDAQ Composite Index slumped 49.64, or 3 percent, to 1,600.85.
* The Dow Jones Industrial Average slid 97.50, or 1 percent, to 9,939.92.
POOR INTERNAL CONTROLS: Insurance Bureau Director-General Shih Chiung-hwa said the company is expected to get back on track while its chairman is suspended The Financial Supervisory Commission (FSC) yesterday fined Shin Kong Life Insurance Co (新光人壽) NT$27.6 million (US$939,415) for a reckless investment that endangered its solvency, and suspended its chairman Eugene Wu (吳東進) for poor supervision. The penalty is the second-highest in a single case after Nan Shan Life Insurance Co (南山人壽) was fined NT$30 million in September last year and its chairman Du Ying-tzyong (杜英宗) suspended for two years, the commission said. In three rounds of special and regular examinations conducted since last year, the commission found that Shin Kong Life had given too much power to an asset and liability management committee
Continental AG, which makes control units for Daimler AG cars, cannot pursue antitrust claims against a group of patent owners, including Qualcomm Inc, which are seeking royalties on telecommunications technology, a federal judge in Texas ruled. Avanci LLC, a licensing pool formed by Qualcomm, Nokia Oyj, Sharp Corp and other owners of patents on technology standards, is not breaching antitrust laws when it negotiates license agreements with automakers rather than the component makers, Barbara Lynn, chief district judge for the Northern District of Texas, said in dismissing the suit in a decision posted on Friday. The licensing group charges US$15 per vehicle
Sony Corp has cut its estimated Play Station 5 (PS5) production for this fiscal year by 4 million units, down to about 11 million, following production issues with its custom-designed system-on-chip (SOC) for the new console, people familiar with the matter said. The Tokyo-based electronics giant in July boosted orders with suppliers in anticipation of heightened demand for gaming in the holiday season and beyond, as people spend more time at home due to the COVID-19 pandemic. However, the company has come up against manufacturing issues, such as production yields as low as 50 percent for its SOC, which have cut into
HEAVY INVESTMENT: Moody’s affirmed the firm’s ‘Aa3’ rating with a ‘stable’ outlook due to its leading position in the industry and ability to match customer requirements Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) revenue this year is expected to increase about 21 percent to NT$1.29 trillion (US$44.01 billion) from NT$1.07 trillion last year, driven by strong demand for advanced 5-nanometer and 7-nanometer chips mainly used in smartphones and high-performance computing devices, a Moody’s Investors Service report on Wednesday said. TSMC’s rate of revenue growth next year is to increase to 7.5 percent, the ratings agency said. The company, which supplies 5-nanometer chips for Apple Inc’s new iPad series, has introduced the advanced chips ahead of its competitors and gained a significant share of the market for the foundry industry’s