Yahoo stumbles again in 3Q, raising stakes on Verizon deal
SAN FRANCISCO (AP) — Yahoo stumbled through another rough patch in the third quarter, ramping up the pressure on the slumping internet company to complete its $4.8 billion sale to Verizon Communications.
The results released Tuesday represented Yahoo’s first financial update since announcing in late July its deal to sell its digital operations to Verizon.
The numbers showed Yahoo is profiting from a cost-cutting program that has jettisoned 2,200 workers, or about one-fifth of its workforce, during the past year. The Sunnyvale, California, company earned $163 million, or 17 cents per share, more than doubling from the same time last year.
But Yahoo’s revenue plunged 14 per cent to $857 million after subtracting advertising commissions for the period covering July through September. It marks the fourth consecutive quarter that Yahoo’s net revenue has dropped by at least 10 per cent, a trend that management forecast will extend into the final three months of this year.
Google’s Pixel phone: Not much new, but still a standout
NEW YORK (AP) — Google’s ambitious new smartphone, the Pixel, doesn’t offer a lot that’s new. Yet it’s still one of the best out there.
Google achieves that by pulling together the best features from Apple, Samsung and other phone makers and offering them at prices comparable to iPhones — starting at about $650 for the regular, 5-inch model and $770 for the 5.5-inch “XL” edition. Both versions go on sale Thursday through Verizon, Best Buy and Google’s online store.
The Pixel isn’t quite an iPhone replacement, as Google wants you to believe; hardware is just part of what makes an iPhone an iPhone. But it might serve up a strong challenge to Samsung, especially as people look for alternatives to the fire-prone Galaxy Note 7.
US stocks rebound on strong company earnings; oil rises
Surprisingly strong earnings from Netflix, UnitedHealth Group and other companies put investors in a buying mood Tuesday, driving U.S. stocks solidly higher.
Health care stocks led the gainers. Materials, utilities and a broad swath of other companies also posted gains. Industrials and consumer-focused stocks notched the smallest gains. Energy stocks also rose as the price of crude oil recovered from an earlier slide.
The rally wiped out the market’s losses from the day before.
$4 a month? Social Security recipients to get tiny increase
WASHINGTON (AP) — Millions of Social Security recipients and federal retirees will get a 0.3 per cent increase in monthly benefits next year, the fifth year in a row that older Americans will have to settle for historically low raises. The adjustment adds up to a monthly increase of less than $4 a month for an average recipient.
The cost-of-living adjustment, announced by the government Tuesday, will affect more than 70 million people — about 1 in 5 Americans. For recipients, the average monthly Social Security payment now is $1,238.
Unfortunately for some seniors, even the small increase will probably be wiped out by an expected increase in Medicare Part B premiums, which are usually deducted from Social Security payments.
Trading gains drive Goldman Sachs’ profits sharply higher
NEW YORK (AP) — Goldman Sachs’ earnings soared in the third quarter, driven largely by trading and investment gains. The results easily surpassed analysts’ estimates.
The New York-based bank said Tuesday that it earned $2.1 billion, or $4.88 per share, up from $1.33 billion, or $2.90 per share, in the same period a year earlier. Wall Street analysts were expecting Goldman to earn $3.82 a share, according to FactSet.
While the firm’s investment banking division reported flat revenue, a reflection of the fact fewer companies did deals in the quarter, Goldman’s trading desks and the division where it invests its own money did exceptionally well.
Revenue in Goldman’s fixed income, currencies and commodities division jumped 34 per cent to $1.96 billion. Goldman benefited from similar forces that helped boost trading of other major Wall Street banks, including JPMorgan Chase, Citigroup and Bank of America.
A surprisingly high number of first-timers now buying homes
WASHINGTON (AP) — For years, the U.S. housing market looked bleak for young couples hoping to buy their first homes but struggling with high student debt, low pay and meagre down-payment savings.
But a new survey by the real estate firm Zillow suggests that first-time buyers may be entering the market in greater numbers than industry watchers had assumed.
Over the past year, the survey found, nearly half of home sales have gone to first-timers. That’s a much higher proportion than some other industry estimates had indicated. And it comes as a surprise in part because ownership rates for adults under 34 are at their lowest levels since the government began tracking the figure in 1994.
Gov’t announces new steps to protect airline consumers
WASHINGTON (AP) — Airlines would be required to refund fees when checked bags are “substantially delayed” under a proposal released Tuesday by the Transportation Department, one of a series of steps the Obama administration says it’s taking to boost consumer protections for passengers.
The government already requires airlines to refund fees for bags that are lost, but the proposal would go a step further by including delayed bags. Transportation officials said they haven’t yet defined what constitutes a substantial delay.
US consumer prices rose in September on higher oil costs
WASHINGTON (AP) — Higher energy costs fueled U.S. consumer prices in September, but overall inflation remained in check as it has for the past several years.
The Labor Department said Tuesday that consumer prices increased 0.3 per cent last month. Much of that rise stemmed from energy, housing and prescription drugs. Energy costs surged 2.9 per cent in September as oil and gasoline prices rebounded from recent lows. Previous price declines still mean that gas costs 6.4 per cent less than a year ago.
Inflation has stayed relatively low despite job growth that has brought more workers into the economy. Until last month, the modest levels of inflation largely came from muted oil prices and a stronger dollar.
US homebuilders’ confidence eases slightly
U.S. homebuilders’ confidence eased this month after surging to the highest level in nearly a year in September.
Even so, builders remain optimistic overall about sales growth in months ahead, a reflection of how steady job gains are leading more Americans to buy newly built homes.
The National Association of Home Builders/Wells Fargo builder sentiment index released Tuesday fell two points this month to 63 following a reading of 65 in September.
Readings above 50 indicate more builders view sales conditions as good rather than poor. The index has held above 60 the past two months after hovering at 58 earlier this year.
Foreign holdings of US Treasury securities fell in August
WASHINGTON (AP) — Foreign holdings of U.S. Treasury securities fell again in August as China, the biggest foreign owner of Treasury debt, trimmed its holdings for the third straight month.
The Treasury Department reported Tuesday that total foreign holdings dropped 0.8 per cent to $6.20 trillion in August following a 0.5 per cent decline in July.
China reduced its holdings 2.7 per cent to $1.19 trillion after declines of 1.8 per cent in July and 0.3 per cent in June. Japan, the second largest foreign holder of Treasury debt, reduced its holdings by 0.9 per cent to $1.14 trillion in August.
The Dow Jones industrial average gained 75.54 points, or 0.4 per cent, to 18,161.94. Standard & Poor’s 500 index rose 13.10 points, or 0.6 per cent, to 2,139.60. The Nasdaq composite index added 44.01 points, or 0.9 per cent, to 5,243.84.
U.S. benchmark crude oil rose 35 cents, or 0.7 per cent, to close at $50.29 a barrel in New York. Brent crude, the international standard, gained 16 cents, or 0.3 per cent, to close at $51.68 a barrel in London. Wholesale gasoline inched up a penny to $1.51 a gallon. Heating oil was little changed at $1.57 a gallon. Natural gas rose 2 cents to $3.26 per 1,000 cubic feet.