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Factory figures fuel fickle Wall St

Monday, Apr 01, 2013 - 02:24

April 1 - Summary of business headlines: Stocks recede after factory growth slips; Construction spending comforts; Major Apple shareholder cuts stake; Apple forced to give China apology: American Greetings going private; Tesla says quarter will be positive. Conway G. Gittens reports.

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Signs from the factory floor giving investors little reason to push the Dow and the S&P 500 beyond record closing highs set last month. Wall Street beginning the second quarter of 2013 with a negative bias. Growth in the U.S. manufacturing sector slowed in March to its weakest pace in three months. According to the Institute for Supply Management, factories received fewer new orders last month - in a sign cuts in Washington may have started to impact the economy by the end of the month. But Drew Matus of UBS says the real downward pull will start to be felt later in the year. SOUNDBITE: DREW MATUS, SENIOR U.S. ECONOMIST, UBS (ENGLISH) SAYING: "I think we will see more of an impact spring or summer but we also have to bear in mind that a lot of the numbers that are tossed around are way too high. In particular the $85 billion that everyone likes to quote the $85 billion is a cut in budgetary authority. It is not in spending." More encouraging though, construction spending, up in February - reversing January's decline. The key there - spending on private residential projects rising to its highest in 4 years. Apple was the loser of the day. The tech giant's largest active shareholder - Fidelity Contrafund - cut its fund's stake by 10 percent in the first two months of the year. Also, can you say "I'm Sorry" in Chinese? Tim Cook can. The head of Apple apologized to his customers after two weeks of negative press by state-run media in the populous country. One of the complaints - a warranty that's too short. Apple promises to overhaul its consumer practices and made the apologies on its local website. All the news sending Apple shares down by just over 3 percent. American Greetings is a better stock story. The greeting card company surged 12 percent after announcing its founding family is taking the company private in an $878 million deal. Tesla was another standout. The electric car maker says it will make good on a pledge to turn a profit this quarter. Sales of its newest model are exceeding internal expectations - sending the stock up roughly 16 percent. European markets were closed for Easter Monday but there is one story to note. India's high court handed Swiss drugmaker Novartis a "lose" in a patent battle with India's booming generic drug making industry.

Factory figures fuel fickle Wall St

Monday, Apr 01, 2013 - 02:24

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