Companies ask: Does advertising on Facebook pay?
NEW YORK (AP) _ Responding to extraordinary demand, Facebook said Wednesday that it would sell more stock in the company's initial public offering. But ahead of the IPO, a debate emerged between two of the nation's largest automakers: Does it pay to advertise on the social network?
General Motors, the nation's largest automaker, said it would abandon Facebook ads after concluding they were ineffective. At the same time, Ford reaffirmed its commitment to Facebook, saying their relationship was stronger than ever.
The direct financial impact of GM's move is minimal for Facebook, but the decision drew attention to the network's advertising system, which some observers regard as immature.
In a regulatory filing Wednesday, Facebook said it would add 84 million shares, worth up to $3.2 billion, to the IPO, which is shaping up to be the decade's hottest. The company's stock is expected to begin trading Friday on the Nasdaq Stock Market under the ticker symbol "FB".
Lower oil prices ease load on consumers and Obama
NEW YORK (AP) _ A threat that's been hanging over the economy is starting to look a lot less menacing.
Oil and gasoline prices are sinking, bringing relief to businesses and consumers who a few weeks ago were about to face the highest fuel prices ever.
President Barack Obama's re-election prospects could also benefit, especially if prices keep falling as some analysts expect. A majority of Americans disapproved of Obama's handling of gas prices in an AP-GfK poll early this month. That was before the full effect of the recent drop had reached drivers.
The average U.S. retail gasoline price has dropped 21 cents a gallon to $3.73 since hitting a 2012 peak of $3.94 on April 6.
US economy picks up after early spring slump
WASHINGTON (AP) _ Maybe the U.S. economy's strength this winter wasn't just weather-related after all.
Home construction is near a three-year high. And factory output has risen in three of the year's first four months.
The data released Wednesday suggest growth in the April-June quarter is off to a good start, helped by falling gas prices and solid hiring gains. Fears of a spring slump are easing.
J.C. Penney's shares in free-fall after 1Q loss
NEW YORK (AP) _ Wall Street doesn't seem to like J.C. Penney's new everyday low pricing any better than Main Street does.
The department store chain's stock plunged nearly 20 percent on Wednesday_ the biggest decline since the 1987 market crash. The drop comes a day after Penney said it would no longer pay out a dividend and blamed its larger-than-expected first-quarter loss on shoppers' poor reception of its strategy of ending hundreds of big sales each year and offering what it called predictable low prices every day.
The pricing plan, rolled out on Feb. 1, aims to stop a cycle of heavy discounting and discourage customers from waiting for sales. But the reaction by investors and shoppers shows how difficult it will be for Penney to change the mindset of consumers who were conditioned to expect blockbuster deals from Penney and other retailers during the economic downturn.
Fed: Several members could support further easing
WASHINGTON (AP) _ Federal Reserve policymakers are open to further efforts to stimulate the U.S. economy if growth falters or threats to it escalate.
Minutes of the central bank's April 24-25 meeting released Wednesday showed that several members thought additional Fed support could be needed if the recovery lost momentum or if the risks to the economy became great enough.
The minutes did not spell out what circumstances could trigger further Fed efforts to lower interest rates to boost the economy. But it did note some threats to the U.S. economy. One is Europe's debt crisis. Another is the risk that spending cuts and tax increases that could take effect at year's end if Congress can't reach a budget agreement could slow growth more than expected.
AP IMPACT: Evacuations and drills pared near nuke plants
Without fanfare, the nation's nuclear power regulators have overhauled community emergency planning for the first time in more than three decades, requiring fewer exercises for major accidents and recommending that fewer people be evacuated right away.
Nuclear watchdogs were surprised and dismayed over the quietly adopted revamp _ the first since the program began after the Three Mile Island incident in 1979. Several said they were unaware of the changes until now, though they took effect in December.
At least four years in the works, the changes appear to clash with more recent lessons of last year's reactor crisis in Japan. A mandate that local responders always run practice exercises for a radiation release has been eliminated _ a move viewed as downright bizarre by some emergency planners.
Target's 1Q profits up 1.2 percent
NEW YORK (AP) _ Target Corp. raised its profit outlook Wednesday after reporting better-than-expected first-quarter results that were boosted by increased spending on food and cheap chic fashions.
Like most retailers, Target has faced the challenge of trying to find ways of luring cautious U.S. shoppers into stores amid a flood of mixed economic news that has them scrutinizing many purchases. The job and housing markets are still shaky, but falling gas prices have given consumers hope.
Target, which mixes stylish clothes and trendy decor under the same roof as toothpaste and cereal, recently has had success drawing customers into stores with two growth initiatives. It has been offering a larger selection of food and a program it started in 2010 that gives shoppers a 5 percent discount when they pay with Target-branded credit and debit cards.
Deere fiscal 2Q profit rises, beating expectations
MOLINE, Ill. (AP) _ Deere posted a 17 percent spike in second-quarter profit on Wednesday and boosted its outlook for the year, predicting record-high global demand for its signature tractors, harvesters and seeders.
Analysts had been anxiously awaiting Deere's take on the year going forward, with the potential for unprecedented crop production lowering commodity prices.
Deere said that it expects sales for the current quarter to rise 25 percent, easily outpacing Wall Street predictions.
FTC: Skechers deceived consumers with shoe ads
WASHINGTON (AP) _ The government wants you to know that simply sporting a pair of Skechers' fitness shoes is not going to get you Kim Kardashian's curves or Brooke Burke's toned tush.
Skechers USA Inc. will pay $40 million to settle charges by the Federal Trade Commission that the footwear company made unfounded claims that its Shape-ups shoes would help people lose weight and strengthen their butt, leg and stomach muscles. Kardashian, Burke and other celebrities endorsed the shoes in Skechers ads.
Wednesday's settlement also involves the company's claims for its Resistance Runner, Toners, and Tone-ups shoes as well.
Consumers who bought the shoes will be eligible for refunds, though it's not clear how much money they'll get. The FTC says that will depend on how many claims are received in the eight-month filing period. Buyers can go to the FTC website to file a claim.
Google strives to enlighten with new search tool
SAN FRANCISCO (AP) _ Google is introducing a new tool, designed to make its search engine smarter.
The new feature debuting Wednesday draws from a Google-built database of more than 500 million people, places and commonly requested things to provide a summary of vital information alongside the main search results.
Google Inc. spent the past two years poring through online encyclopedia Wikipedia, the CIA Factbook and other sources to expand a database of 12 million items that it picked up as part of its 2010 acquisition of Metaweb.
The information warehouse, which Google calls a "Knowledge Graph," is an attempt by the Internet's dominant search engine to provide answers as quickly and concisely as possible so users don't have to sift through a hodgepodge of Web links displayed on the main results page.
By The Associated Press(equals)
The Dow Jones Industrial average fell 33.45 points to 12,598.55, and the Standard & Poor's 500 index fell 5.86 points to 1,324.80. The Nasdaq composite index fell 19.72 points to 2,874.04.
Benchmark U.S. crude on Wednesday fell by $1.17 to finish at a seven-month low of $92.81 per barrel in New York. Oil is down nearly 13 percent since the beginning of May.
Brent crude, which helps set the price of oil imported into the U.S., fell by $1.70 to finish at $109.75 per barrel in London.
In other energy futures trading, heating oil lost 3.54 cents to finish at $2.8976 per gallon, while wholesale gasoline fell dropped by 2.32 cents to end at $2.9209 per gallon. Natural gas rose by 11.8 cents to end at $2.618 per 1,000 cubic feet.