Apr. 5 - Summary of business headlines: Stocks fall as tepid jobs numbers add to slowing economy fear; Ackman calls J.C. Penney turnaround “close to disaster”; Boeing tests 787 again; Disney prepares for layoffs-sources. Conway G. Gittens reports.
▲ Hide Transcript
▶ View Transcript
Wall Street shudders, with the S&P 500 having its worst week of the year, but Friday's losses were not as bad as they could have been with the jobs numbers coming in disappointing low.
The Dow gave up 40 points, the S&P 500 shed 6 and the Nasdaq 21.
As for the week, blue chips went basically nowhere, while the Nasdaq - down almost 2 percent.
On the first Friday of every month attention turns to jobs - and this time the report was quite disappointing. Employers added 88,000 jobs in March. That was the slowest job creation in nine months. Meanwhile, the unemployment rate fell to 7.6 percent, but that was mainly due to the exit of almost half-a-million Americans from the workforce. The jobs figures capped off a week of data pointing to an economy that is losing steam.
There's a lot of eyes on J.C. Penney. The struggling retailer is trying something new - again. This time it's rolling out store-within-a-store focused on home goods. Meanwhile, Board of Director member and investor Bill Ackman, a staunch ally of CEO Ron Johnson, admits a turnaround attempt "has been something very close to a disaster."
SOUNDBITE: BILL ACKMAN, CEO, PERSHING SQUARE CAPITAL MANAGEMENT (ENGLISH) SAYING:
"Sales are down tremendously, sequential comps have declined dramatically, no business can survive the trend here and he is working very aggressively with his team to fix the mistakes that have been made. And there have been some mistakes and I think one of the big mistakes was perhaps too much change, too quickly without adequate testing about what the impact would be."
Shares of the retailer are up for the day but have lost half their value since the new CEO arrived in 2011. Ackman calls J.C. Penney the highest risk in his portfolio.
Boeing has a "good plan" to fix the battery problem that's grounded the 787 since January, but the U.S. Transportation Department is not yet ready to lift that ban. The Dreamliner completed another in a series of tests Friday. The company has had to rework the plane's electrical system to prevent fire or an overheated battery. Boeing was the biggest point gainer in the Dow.
Walt Disney is readying layoffs at its studio and consumer product divisions within the next two weeks, according to people familiar with the plan. How many jobs will be cut is not known, as a spokesperson declined to comment.
Finishing up with Europe now, markets had their worst day of the year as the weak U.S. jobs numbers sent shivers across the Atlantic.
Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code