Solid US corporate profits fail to impress investors worried about global economic slowdown
NEW YORK (AP) — Investors to Corporate America: Meh.
U.S. companies are reporting strong profits for the fourth quarter of last year. But most are failing to impress investors who were hoping for even better numbers or rosier outlooks, and are too worried about larger global macroeconomic forces to do much buying.
"Earnings season is going quite well," says Christine Short, a senior manager at the research firm S&P Capital IQ. "But what we're seeing in earnings season is not what we are seeing in the market."
With results in from half of the companies in the S&P 500 index, fourth-quarter earnings are up a respectable 7.3 percent, making it the best quarter of last year, according to S&P Capital IQ. Of the 250 companies that have reported results, 172 companies have beaten earnings expectations and 51 have fallen short, a better ratio than average. Company revenues have also come in better than in the past relative to expectations.
It's just not enough for investors. The S&P 500 fell 41 points Monday, or 2.3 percent, and is down 5.2 percent since earnings season kicked off on January 9.
Senate set to vote on farm bill, send massive legislation to President Obama
WASHINGTON (AP) — Congress is poised to send a massive, five-year farm bill that provides food for the needy and subsidies for the nation's farmers to the White House for President Barack Obama's signature.
The Senate was expected to pass the almost $100 billion-a-year compromise bill Tuesday; the House passed it last week. The bill provides a financial cushion for farmers who face unpredictable weather and market conditions, while also continuing to subsidize services for rural residents and communities who have hit hard times in recent years. The majority of the bill's cost is food stamps, which supplement meal costs for 1 in 7 Americans.
House Republicans had hoped to trim the bill's costs, pointing to a booming agriculture sector in recent years and saying the now $80 billion-a-year food stamp program has spiraled out of control. Partisan disagreements stalled the bill for more than two years, but conservatives were eventually outnumbered as the Democratic Senate, the White House and a still-powerful bipartisan coalition of farm-state lawmakers pushed to get the bill done.
The final compromise bill would get rid of controversial subsidies known as direct payments, which are paid to farmers whether they farm or not. But most of that program's $4.5 billion annual cost was redirected into new, more politically defensible subsidies that would kick in when a farmer has losses. The food stamp program was cut about 1 percent; the House had pushed for five times that much.
Senate Agriculture Chairwoman Debbie Stabenow, D-Mich., said Monday that she and her House counterpart, Rep. Frank Lucas, R-Okla., tried to craft a bill that would work for all regions of the country, "from traditional row crops, to specialty crops like fruits and vegetables, to livestock, to organics, to local food systems."
Cabin fever setting in as relentless snowfall, bitter cold, ice storms hit parts of US
ST. LOUIS (AP) — T.J. Rutherford loves to golf, even in the winter. Just not this winter.
With single-digit temperatures and sub-zero wind chills becoming the norm from the Midwest to the East Coast, often combined with snow or ice, the 59-year-old and his Illinois golfing buddies are no longer just bundling up. They're staying inside.
"I'm on my third 1,000-piece jigsaw puzzle," said Rutherford, who lives in Carterville, about 100 miles southeast of St. Louis. "I haven't done that in a long time."
Cabin fever is setting in for countless Americans as bitter cold, heavy snowfall and paralyzing ice storms keep pounding a large swath of the country. School districts across two-thirds of the U.S. are reporting higher than normal numbers of snow days, while social service agencies are trying to work around the forecasts to get to people in need.
Heavy snow was falling — again — in New York on Monday, and up to 8 inches of snow was expected Tuesday in Kansas City, Mo. Later this week, snow was forecast from the Plains to the East Coast, with no break in the cold.
Target data breach sparks debate between banks and retailers as Congress examines issue
WASHINGTON (AP) — Banks and big retailers are locked in a debate over the breach of consumer data that gripped Target Corp. during the holiday season. At issue: Which industry bears more responsibility for protecting consumers' personal information?
The retailers' argument: Banks must upgrade the security technology for the credit and debit cards they issue.
The banks' counterargument: Newer electronic-chip technology wouldn't have prevented the Target breach. And retailers must tighten their own security systems for processing card payments.
The finger-pointing is coming from two industries with considerable lobbying might. Their trade groups have been bombarding lawmakers with letters arguing why the other industry must do more — and spend more — to protect consumers.
"Nearly every retailer security breach in recent memory has revealed some violation of industry security agreements," the Independent Community Bankers argued last month. "In some cases, retailers haven't even had technology in place to alert them to the breach intrusion, and third parties like banks have had to notify the retailers that their information has been compromised."
FDA launching $115M multimedia education campaign showing at-risk youth 'real cost' of smoking
WASHINGTON (AP) — The Food and Drug Administration is using ads that depict yellow teeth and wrinkled skin to show the nation's at-risk youth the costs associated with cigarette smoking.
The federal agency said Tuesday it is launching a $115 million multimedia education campaign called "The Real Cost" that's aimed at stopping teenagers from smoking and encouraging them to quit.
Advertisements will run in more than 200 markets throughout the U.S. for at least one year beginning Feb. 11. The campaign will include ads on TV stations such as MTV and print spots in magazines like Teen Vogue. It also will use social media.
"Our kids are the replacement customers for the addicted adult smokers who die or quit each day," said Mitch Zeller, the director of the FDA's Center for Tobacco Products. "And that's why we think it's so important to reach out to them — not to lecture them, not to throw statistics at them — but to reach them in a way that will get them to rethink their relationship with tobacco use."
Zeller, who oversaw the anti-tobacco "Truth" campaign while working at the nonprofit American Legacy Foundation time in the early 2000s, called the new campaign a "compelling, provocative and somewhat graphic way" of grabbing the attention of more than 10 million young people ages 12 to 17 that are open to, or are already experimenting with, cigarettes.
Internet firms release new data on NSA surveillance requests after recent legal deal
WASHINGTON (AP) — Major technology firms have released new data on how often they are ordered to turn over customer information to the government for secret national security investigations, resulting in the collection of data on thousands of Americans.
That release came after the companies were freed by a recent legal deal with government lawyers.
The publications disclosed by Google, Microsoft, Yahoo, Facebook, LinkedIn and Tumblr provided expanded details and some vented criticism about the government's handling of customers' Internet data in counterterrorism and other intelligence-related probes. The figures from 2012 and 2013 showed that companies such as Google and Microsoft were compelled by the government to provide information on as many as 10,000 customer accounts in a six-month period. Yahoo complied with government requests for information on more than 40,000 accounts in the same period.
The companies earlier had provided limited information about government requests for data, but an agreement reached last week with the Obama administration allowed the firms to provide a broadened, though still circumscribed, set of figures to the public.
Seeking to reassure customers and business partners alarmed by revelations about the government's massive collection of Internet and computer data, the firms stressed details indicating that only small numbers of their customers were targeted by authorities. Still, even those small numbers showed that thousands of Americans were affected by the government requests approved by judges of the secret Foreign Intelligence Surveillance Court.
Japan's Nikkei index ends at four-month low; leads latest global market sell-off
LONDON (AP) — Japanese shares led another global market sell-off Tuesday as investors fretted over the U.S. economic recovery amid ongoing uncertainties about the outlook for emerging economies.
Diving over 4 percent, the Nikkei 225 stock index ended at a four-month low, sending shivers across Asia. European stock markets are down again but the pace of selling appears to have stabilized somewhat.
The turmoil that has afflicted financial markets over the past few weeks has a number of causes. Some analysts think it's a long-overdue correction in stock values that will eventually bottom out. Many indexes had finished 2013 at record highs.
Others think it's likely to last longer, not least because the U.S. Federal Reserve is reducing its monetary stimulus. The stimulus, in its various guises, has helped shore up markets, particularly in developing countries from Brazil to Turkey to India, since the financial crisis.
"What we're seeing in the markets so far this year may not be investors panicking about the turmoil in emerging markets, or the ongoing weaknesses in corporate earnings, or even the poor data coming out of the U.S. for December and January," said Craig Erlam, market analyst at Alpari.
Merger of Charter, Time Warner Cable could future-proof operators against Internet's rise
LOS ANGELES (AP) — When you buy a TV, sales clerks often pitch you on "future proofing" your set. Turns out, buying a cable TV company relies largely on the same principle.
Charter Communications Inc.'s $38 billion bid to take over the much-larger Time Warner Cable Inc. is an attempt to future-proof its business by getting its foot in the door of millions more homes wired for Internet service.
As people use more mobile devices, watch more online video and connect everything from thermostats to refrigerators to the Internet, delivering those Internet services will become increasingly valuable.
Gone are the days when one's primary reason for hooking up cable was for TV. Now, it's the Internet, which enables countless online services known collectively as the cloud — everything from movies on Netflix to backup files on Dropbox.
"Broadband is the gatekeeper to the cloud," says Tony Wible, an analyst with Janney Capital Markets. "There's insatiable demand for broadband."
Election coverage shows growth of Afghanistan's new media, but will press remain free?
KABUL, Afghanistan (AP) — In a crowded room overlooking a gleaming television studio, Tolo TV's election team is strategizing for Afghanistan's presidential debate when the room suddenly goes dark. The staff doesn't miss a beat.
The 13 men and three women just keep on talking about soundboards, cameras and the taking of questions via Twitter until the station's generator kicks in and the overhead lights flicker back on.
"It's just technical difficulties," explains Mujahid Kakar, the Tolo anchor and moderator of the upcoming debate among six of the main contenders vying to succeed President Hamid Karzai in the April 5 election.
The moment is a reminder of the difficulties of reporting in an impoverished country torn by war. Yet, in many ways, Afghan media coverage of the crucial campaign that kicked off this week resembles what you'd see in any other modern democracy, with newspaper candidate profiles and political talk shows on numerous TV and radio stations.
And this week, for the first time, major contenders for the presidency will introduce themselves to the nation in a televised debate.
DeAndre Kane scores 26 to lead No. 16 Iowa State in 98-97 3OT win over No. 19 Oklahoma State
STILLWATER, Okla. (AP) — None of Iowa State's players had been born the last time the Cyclones won at Oklahoma State's Gallagher-Iba Arena.
It took some extra effort, but Iowa State finally got it done. DeAndre Kane had 26 points, 10 rebounds and nine assists to help the 16th-ranked Cyclones defeat No. 19 Oklahoma State 98-97 in triple overtime on Monday night. It was Iowa State's first in Stillwater since March 2, 1988 — a span of 18 games.
"To gut this win out was huge," Iowa State coach Fred Hoiberg said. "It would have been a very difficult loss fighting three overtimes and walking out of here with a loss. I'm proud of our guys for finding a way to win it."
Kane got to the rim nearly at will while primarily being guarded by Oklahoma State star Marcus Smart. Kane said he respected Oklahoma State's effort.
"I'll tip my hat to them, they played a great game, but my guys fought it out all night," he said.