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Stocks sink on economic angst

Thursday, May 05, 2011 - 02:01

May 4 - Summary of business headlines: Economic data dent investor optimism; CEO of China's Renren says brand advertising will be key growth driver as stock debuts on NYSE, whetting appetite for Facebook; UBS agrees to $160 million U.S. settlement; Silver losing shine. Conway Gittens reports.

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PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL The strength of the U.S. economic recovery is once again being called into question. The services sector grew at its slowest pace in more than a year. And private employers created fewer jobs than anticipated last month. But in a bright spot, layoff announcements fell to their lowest of the year. In corporate news: there was much interest in Renren, China's largest social networking company, as the company's stock made its debut in America. But a strong debut gave way to late selling. Still, investors say the debut possibly sets the stage for Facebook, if Facebook ever goes public. CEO Joseph Chen says brand advertising is a key area of future growth on his home turf. SOUNDBITE: JOSEPH CHEN, CHIEF EXECUTIVE OFFICER, RENREN (ENGLISH) SAYING: "Starting from about the past three quarters our advertising business has been growing very nicely as the advertisers, brand advertisers such as Coca-Cola and Nike, recognize the power of using social networks to connect to their audiences. And their businesses are catching up on really rapidly, so we are seeing very hyper growth." UBS has agreed to a $160 million settlement with U.S. regulators, according to the Justice Department. As part of the settlement the European banking giant acknowledged former employees of a municipal bond unit had broken the law. It was a somber day on Wall Street as investors digested disappointing economic data, but the market finished off the lows of the day. Not so for silver - the precious metal has lost one-fifth of its value since hitting a record last week. Information on Portugal's sovereign debt bailout are starting to leak. A euro zone source says it could be as much as 90 billion euros. As for the market: European investors were in a foul mood, sending stocks down by well over a full percent. Conway Gittens, Reuters.

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Stocks sink on economic angst

Thursday, May 05, 2011 - 02:01