NEWS AT A GLANCE
Markets ease up after Fed cut
Most Asian markets closed higher today following the U.S. Federal Reserve’s surprise 75-point interest rate cut yesterday. The Hong Kong Hang Sang index surged 10.7 percent, its biggest jump in 10 years, and benchmark indexes in Japan, China, India, and Australia ticked up 2-6 percent. (AP in Yahoo! Finance) But recession fears continued to weigh on European markets. (MarketWatch) Skittish investors are concerned that the Fed “has blown all of its ammunition in one go,” said Commerzbank economist Peter Dixon. “We’ve stepped off the rollercoaster, we’re all a bit giddy, and we’re trying to get our bearings.” (Reuters)
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Apple outperforms, takes a hit
Apple Inc. reported a better-than-expected 58 percent jump in first-quarter profits, to a record $1.58 billion, but its stock fell more than 11 percent in extended trading on its guidance. Apple forecast a brisk 29 percent uptick in sales for the second quarter, but Wall Street was expecting more. (AP in Yahoo! Finance) Apple “is lowballing the Street on the March quarter, but this is not a good environment to lowball the market,” said Romeo Dator of the U.S. Global Investors All-American Equity Fund. (MarketWatch) Still, analysts are mixed on how much the wider economic slowdown will affect Apple. (Reuters)
Swiss Re soars on Buffett stake
Shares of Swiss Reinsurance, the world’s largest reinsurer, rose more than 7 percent in Zurich today after Warren Buffett’s Berkshire Hathway bought a 3 percent stake in the company. Under the deal, Berkshire will take control of 20 percent of Swiss Re’s property and casualty insurance for five years. Swiss Re said it would use the extra capital to buy back $1.58 billion in shares. (MarketWatch) Analysts say that given his other recent insurance buys, Buffett thinks the sector is undervalued. “I was stunned,” said JPMorgan analyst Michael Huttner. “Berkshire Hathaway isn’t known to give anything away.” (Bloomberg)
Keeping product placement real
Product placement is a surprise beneficiary of the Hollywood writers’ strike. As TV networks fill strike-emptied programming slots with reality shows, incorporating sponsors’ products is gaining favor because reality show participants are more willing than actors to hawk products, and viewers seem more tolerant of that kind of advertising if it is in a “realistic” setting. NBC is going so far as to build a new reality show around a sponsor, Teleflora. “People are watching television; they’re just not watching commercials,” says Teleflora chairwoman Lynda Resnick. But that means the branded entertainment has to, in fact, be entertaining, she adds. (The New York Times, free registration)
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