News Column

US Stock Markets Stable; Fed Chairman Warns of 'Threat'

Nov. 20, 2012
Federal Reserve Chairman Bernanke
Ben Bernanke

Major US stock indices registered little change on Tuesday on relatively low volume as Americans prepare to celebrate the national holiday of Thanksgiving.

After the holiday, Congress will return to Washington to resume wrestling over how to avoid the fiscal cliff. Federal Reserve Chairman Ben Bernanke warned Tuesday that failure to resolve the standoff would pose a "substantial threat" to economic recovery.

The fiscal cliff refers to 600 billion dollars in spending cuts and tax increases that will hit the economy starting in January unless Democrats and Republicans agree on an alternative path.

Housing data that showed the the number of new-home constructions unexpectedly climbed to a four-year high in October, a good bit of economic news.

Tech giant Hewlett-Packard (HP) fell 12 per cent to 11.71 dollars after announcing it would write down 8.8 billion dollars of the 10.3 billion dollars it paid for software firm Autonomy. HP, until recently the world's largest PC maker, said the deal had been completed based on fraudulent information presented by the British company.

The blue-chip Dow Jones Industrial Average dropped 7.45 points, or 0.06 per cent, to 12,788.51. The broader Standard & Poor's 500 Index rose 0.92 points, or 0.07 per cent, to 1,387.81. The technology-heavy Nasdaq Composite Index rose 0.61 points, or 0.02 per cent, to 2,849.39.

The US currency was lower at 78.02 euro cents from 78.23 euro cents on Monday. The dollar was up against the yen at 81.67 from 81.41 yen on Monday.

Source: Copyright 2012 dpa Deutsche Presse-Agentur GmbH

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