Tuesday, July 2, 2019

Business briefly: Stocks rebound to nudge the S&P 500 to record high again

Stocks shook off an early wobble to eke out small gains Tuesday, nudging the S&P 500 index to an all-time high for the second straight day.

Trading was subdued ahead of the Independence Day holiday in the U.S. Thursday. Markets will close early on Wednesday.

The Dow Jones Industrial Average gained 69.25 points, or 0.3%, to 26,786.68. The Nasdaq composite added 17.93 points, or 0.2%, to 8,109.09.

Small-company stocks fell, sending the Russell 2000 index down 9.13 points, or 0.6%, to 1,560.54.

Companies are lining up to tell investors in upcoming weeks how much profit they made during the spring. Expectations are generally low, and this could be the first time in three years that S&P 500 companies report a back-to-back decline in overall earnings, according to FactSet.

Besides the government’s latest monthly tally of hiring on Friday and the beginning of the next earnings reporting season, the next big milestone for markets may be the Federal Reserve’s meeting at the end of July. There, many investors expect the Fed to cut interest rates for the first time since the Great Recession in 2008 in the face of slowing economic momentum around the world.

Energy stocks fell broadly after U.S. crude oil prices slid nearly 5% a day after OPEC agreed to extend a cut in production levels for nine months. Marathon Oil dropped 4.9% and Concho Resources lost 4.3%.

The yield on the 10-year Treasury note fell to 1.97% from 2.03% late Monday. The yield is now close to its lowest level since the 2016 election. Yields have been falling since last autumn on worries about a slowing economy and as expectations have climbed for a rate cut by the Federal Reserve.

The slide in bond yields weighed on financial stocks. When yields decline they push down interest rates that banks charge for mortgages and other loans, cutting into their profits. Comerica dropped 3.3% and SunTrust Banks fell 1.6%.

Data scientist drops Facebook defamation suit

Aleksandr Kogan, the data scientist at the center of Facebook’s Cambridge Analytica privacy scandal, said he is dropping a defamation lawsuit against the social network rather than engage in an expensive, drawn-out legal battle.

Kogan, 33, sued the social giant in March, claiming it scapegoated him to deflect attention from its own misdeeds, thwarting his academic career in the process. The suit sought unspecified monetary damages and a retraction and correction of what Kogan said were “false and defamatory statements.”

“We thought there was a one percent chance they would do the right thing,” Kogan told The Associated Press. Facebook is “brilliant and ruthless,” he added. “And if you get in their way they will destroy you.”

A Facebook spokesperson said the company had “no comment to share concerning this development.”

The former Cambridge University psychology professor created an online personality test app in 2014 that vacuumed up the personal data of as many as 87 million Facebook users . The vast majority of those were unwitting online friends of the roughly 200,000 people Kogan says were paid about $4 to participate in his “ThisIsYourDigital Life” quiz.

Cambridge Analytica, a political data-mining firm founded by conservative power brokers including billionaire Robert Mercer and former White House aide Steve Bannon, paid Kogan $800,000 to conduct his research and to provide the firm with a copy of the data. The project’s aim was to create voter profiles based on Facebook users’ online behavior to help in tailored political-ad targeting, according to Christopher Wylie, a former data scientist at the firm.

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