Bernanke Back on Hill, Wall Street Looks for More Gains
Federal Reserve Chairman Ben Bernanke's comments on Tuesday were certainly a buzz kill to any hopes of a quicker economic recovery. In testimony before the Senate, the Fed chief said recovery was being held back by weakness in Europe, the U.S. job market and the upcoming fiscal cliff--and offered few clues on whether the central bank was on board for a fresh round of monetary stimulus.
The less-than-optimistic comments didn’t dent stocks in the end: The Dow gained 78 points Tuesday, finishing higher for just the third time this month.
Bernanke gives an encore performance before the House today. Ahead of that, U.S. stock futures are lower.
A new Senate report is slamming Europe’s biggest bank HSBC, accusing it of allowing Mexican drug traffickers and possible financiers of militant groups to use its U.S. operations for illicit purposes. What’s more, the report claims U.S. regulators knew of the bank’s lax controls, and did nothing about it.
HSBC’s head of compliance has since resigned and the bank has apologized in the wake of the discovery.
HSBC shares that trade here in the U.S. were lower yesterday, and are down another 1.7% in early trading today.
Intel (NASDAQ:INTC), the world's largest chipmaker, said the weak global economy is slowing its growth, and warned that revenue for the current quarter is likely to come in below Wall Street forecasts. For the second quarter, Intel said it earned $2.8 billion, which was better than expected. Meanwhile, revenue came in relatively inline with estimates at $13.5 billion.
Intel’s chips are used in 80% of the world’s computers and is seen as a bellwether for spending on technology. However, demand for PCs here in North America has slowed as well as growth in Europe, and emerging markets like Brazil and China.That has Intel looking at Windows 8 as its Hail-Mary pass. The new operating system from Microsoft is due out this fall, and is designed to work well on tablets as well as PCs. Intel is hoping the refresh will spur consumers to buy new devices.
Intel shares are down 1% in the pre-market.
Tough economy… tough to make ends meet. More and more Americans are borrowing against their retirement savings. New data from a Brookings Institute researcher and a Navigant Economics managing director show that 17.4% of loans borrowed against 401(k)s defaulted over the past year, draining $37 billion dollars from retirement savings.
In real dollar terms, that means defaulting on a $6,000 loan could sap $10,000 from one's golden egg.