Wall St. collapses as the tech sector is hit
NEW YORK – Wall Street accumulated further losses on Wednesday after shares closed broadly lower, erasing the market’s gains from the day before.
The S&P 500 fell 2.4% after giving up on a previous gain. The selling, which accelerated in the afternoon, was widespread, although tech stocks accounted for the biggest losses. The decline intensifies the September drop in the benchmark index to 7.5% after a five-month rally.
The market has been hit by several momentum shifts recently.
“There have been 23 bull market corrections since World War II and the average decline has been 14%,” said Sam Stovall, chief investment strategist at CFRA. “Basically I see the same kind of decline taking place.”
At the heart of this month’s big market swings were “Big Tech” stocks. They have soared during the pandemic based on expectations that their growth will only strengthen when the pandemic accelerates work from home and other trends to their advantage. But they started dropping earlier this month out of fears they’d gotten too expensive. Several fell again on Wednesday. Amazon lost 4.1%, Microsoft 3.3% and Apple 4.2%.
“It is mathematically impossible that a corrective phase in those names does not lower the entire index,” said Liz Ann Sonders, chief investment strategist at Charles Schwab.
Mars renames his Uncle Ben’s brand
NEW YORK – Uncle Ben’s rice brand is getting a new name: Ben’s Original.
Parent company Mars Inc. unveiled Wednesday the change for the 70-year-old brand, the latest company to release a logo criticized as a racial stereotype. Packaging with the new name will hit stores next year.
Several companies have withdrawn racial imagery from their branding in recent months, a ripple effect of Black Lives Matters protests over police killing of George Floyd and other African Americans.
Quaker Oats announced in June that it would be withdrawing Aunt Jemima from the syrup and pancake packages, responding to criticism that the character’s origins were based on “mommy,” a black woman who was content to serve her white masters. Quaker said packages without Aunt Jemima’s image will begin appearing in stores later this year, though the company hasn’t revealed the new logo.
The owner of Eskimo Pie also said he will change the name and marketing of the chocolate-covered ice cream shop. In addition to food brands, the Washington NFL franchise ditched the “Redskins” name and Indian head logo amid pressure from sponsors.
In South Carolina, Geechie Boy Mill on Edisto Island, which produces locally grown and ground white groats, is also planning a name change. Geechie is a dialect spoken primarily by the descendants of African American slaves who settled on the Ogeechee River in Georgia, according to Merriam-Webster.com. “We are changing our name and have developed a completely new brand. We look forward to sharing it with the public,” said owner Greg Johnsman.
The offending CEO of Pilgrim’s Pride is out
GREELEY, Colo. – Pilgrim’s Pride has replaced its CEO as it prepares to face the expense of pricing.
The company announced in June that Jayson Penn was taking a leave to focus on his defense after being indicted and has appointed Chief of Finance Fabio Sandri to lead the company in the meantime.
Sandri’s move to CEO was made permanent this week, and Pilgrim’s Pride said in a filing with the Securities and Exchange Commission that Penn is no longer with the company. Penn is one of four current and former executives indicted in June on charges of fixing chicken prices from at least 2012 to 2017. He pleaded not guilty.
Critical eBay offenders to beg
BOSTON – Four former eBay Inc. employees agreed to plead guilty to their role in an intimidation campaign that included sending live spiders and cockroaches to the home of a Massachusetts couple who ran a critical auction site online newsletter federal prosecutors said Wednesday.
“Four former #eBay employees are expected to plead guilty on October 8 at 2:00 pm by zooming into the #Boston Federal Court,” according to a tweet from the official account of the US Attorney’s Office in Massachusetts. “The defendants are accused of participating in a cyberstalking campaign that targeted a couple in Massachusetts.”
The four who should plead guilty are Brian Gilbert, 51; Stephanie Popp, 32 years old; Stephanie Stockwell, 26; and Veronica Zea, 26, according to The Boston Globe. Everyone lives in San Jose, California, with the exception of Stockwell, who lives in Redwood City, California.
They are among seven former eBay employees charged in the case, in which the Massachusetts couple had other creepy items sent to their home, including a funeral wreath and a bloody pig Halloween mask.
They are all accused of conspiracy to commit cyberstalking and conspiracy to tamper with a witness. Their attorneys refused to comment on Wednesday or did not immediately respond to emails seeking comment.
Nike shakes off the blues pandemic
NEW YORK – Nike appears to have recovered from its pandemic crisis, posting a solid quarterly profit driven by the surge in online sales of its sneakers and training apparel.
The largest sportswear manufacturer in the world on Tuesday reported a $ 1.5 billion net profit in the three-month period ending Aug.31, up 11% from the same quarter last year. This was far beyond Wall Street’s expectations.
In the previous quarter that ended May 31, Nike reported an unexpected loss, with its revenue down 38% after digital sales failed to make up for losses in closed physical stores to combat the spread of the coronavirus. But analysts had predicted a rebound because Nike was popular with online shoppers.
In the last quarter, Nike’s digital sales increased 82%, helping to offset the decline in its wholesale and Nike-owned stores. Revenue in the fiscal first quarter was $ 10.6 billion, down 1% from a year ago. Sales in China increased by 6% while sales in North America fell by 2%.