May 17 - Summary of business headlines: Facebook lands biggest technology IPO in history; Wall Street sinks to a four-month low on soft U.S. economic data and euro zone break up fears. Conway G. Gittens reports.
It is what Wall Street has been talking about all year, the Facebook initial public offering. After the close, Facebook announced the IPO priced at $38 a share at the top of the $36 to $38 range, raising more than $16 billion, indeed making it the biggest IPO ever out of Silicon Valley. Arvind Bhatia follows the social media sector for Sterne Agee. SOUNDBITE: ARVIND BHATIA, SENIOR RESEARCH ANALYST, STERNE AGEE (ENGLISH) SAYING: "We are looking at this company and this stock truly as a long term buy, we think they are the middle of changing a lot of industries, not just advertising and the market opportunity the addressable market for them is very large." Euphoria ahead of the Facebook pricing didn't stop Wall Street from sliding to a four-month low. Soft economic data out of the U.S. kept the bears in control. Jobless claims were steady at 370,000 last week, a level suggesting anemic hiring; Business activity in the Mid-Atlantic states unexpectedly shrank in May; and a gauge of future economic activity posted its first decline in seven months. Wal-Mart beat analysts first-quarter profit forecasts and sales topped $112 billion. Not much was said about the allegations of bribery in Mexico, but the company did not rule out a financial impact in the future. Shares closed below $62, not yet able to wipe out declines sparked by the New York Times report of alleged bribery. As for the broader market - stocks slumped led by a more than 2 percent decline in the Nasdaq. Investors flocked to the bond market, pushing the yield on the 10-year Treasury note to the lowest in a least sixty years. Turning to Europe: Shares ended lower and that may continue after Fitch downgraded Greece and Moody's downgraded 16 Spanish banks. Conway Gittens Reuters.