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Overnight Markets: Most US stocks down on World Bank forecast

by Himanshu Singh on Jan 17, 2013 at 03:11

Overnight Markets: Most US stocks down on World Bank forecast

Most US stocks declined on Wednesday as concerns about a lower forecast for global growth in 2013 offset a rally in Apple Inc. and solid earnings from two major banks.

The Dow Jones industrial average was down 24 points, or 0.17%, at 13,511. The Standard & Poor's 500 Index was little changed at 1,473. The Nasdaq Composite Index was up seven points, or 0.22%, at 3,118.

The World Bank said on Tuesday that a slow economic recovery in developed nations is holding back the global economy. It sharply slashed its forecast for world growth in 2013 to 2.4% from an earlier forecast of 3%.

Meanwhile, economic data showed US consumer prices were flat in December, while homebuilder confidence in the market for single family homes held steady near seven year highs in January.

Boeing was the biggest drag on the Dow, with the company’s shares plunging 3.4% on concerns about its new Dreamliner passenger jets. Japan's two leading airlines - All Nippon Airways Co. and Japan Airlines Co., the world’s largest users of the 787 jets - grounded their entire fleet of Dreamliners after an emergency landing.

Financials gained after upbeat earnings results from the two big banks. Shares of Goldman Sachs climbed 4.1% after the lender’s earnings nearly tripled on increased revenue from dealmaking and lower compensation expenses.

JP Morgan added 1% after its fourth-quarter net income jumped 53% and earnings for 2012 set a record.

In the technology sector, Apple rebounded after three days of losses, adding 4.2% boosting Nasdaq. Dell dropped 4.3%, after rallying 21% over the last two days.

Chipotle Mexican Grill Inc. fell 5.5% after reporting preliminary fourth-quarter profit that trailed analysts’ estimates.

After the bell, eBay was trading up 0.7%, reversing an initial decline following the release of its results. Also after the close, shares of CBS jumped 8.3% after it said it will convert its Outdoor Americas division into a real estate investment trust.

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