Shares of Philipsfell 4% Wednesday after the company warned of “extremely poor” consumer demand in Europe.
”Economic indicators around the world point to reduced growth rates,” Gerard Kleisterlee, CEO of the Dutch electronics giant, said in a statement. “Europe in particular is suffering from a weakened consumer retail environment in the second quarter, hampering our growth ambitions in the short term.”
U.S. stocks, meanwhile, posted small gains Wednesday after strong factory numbers and the second straight tame inflation report outweighed rising oil prices.
Despite consumer inflation running at a 2.2%-2.8% annualized rate and signs of an economic slowdown, the Federal Reserve has pledged to continue raising interest rates. With a Fed Funds rate of 3% and two-to-ten-year treasury rates of 3.5%-4.1%, the Fed may force short-term rates above long-term rates — a historical predictor of recession — if it continues its rate hike campaign.
The Nasdaq rose 5 to 2074, the S&P gained 2 to 1206, and the Dow climbed 18 to 10,566. Volume rose to 1.84 billion shares on the NYSE, and 1.73 billion on the Nasdaq. Advancers led 19-12 on the NYSE, and 17-13 on the Nasdaq. Upside volume was 64% on the NYSE, and 63% on the Nasdaq. New highs-new lows were 242-27 on the NYSE, and 119-37 on the Nasdaq.
Googledeclined once again on worries about second-quarter results.
Manugisticsand Silicon Storagejumped on upgrades.
MCIedged higher after a big shareholder said it prefers Qwestbid for the company over Verizon. Qwest dropped out of the bidding after MCI’s board repeatedly opted for lower bids from Verizon.