Wall Street Wrap for 27 August 2010

Wall Street Wrap for 27 August 2010

US GDP growth in the second quarter was revised downward to 1.6%, down from an initial estimate of 2.4% issued last month. Growth has slowed significantly from an annual rate of 3.7% in Q1 and 5% in Q4 of 2009. The news comes along with gloomy stats out this week on factory orders and lower home sales.

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US Fed chairman Ben Bernanke said on Friday that the central bank would prevent the economy from falling into deflation by buying long-term debt and also emphasized that he believed growth would continue in the second half of the year, but at a modest pace.

In corporate news, tech company Intel warned 3rd quarter earnings would be below expectations. Trading of the stock was briefly halted in the morning.

The bidding war between Dell and HP for 3PAR continued on Friday. Although 3PAR accepted Dell’s offer made on Thursday for $1.6 billion, HP upped its bid again on Friday to about $2 billion dollars.

Microsoft co-founder Paul Allen filed a lawsuit against 11 technology companies alleging they violated patents developed at a lab that Allen financed more than 10 years ago. The suit doesn’t specify a damage amount. In world markets, Asian markets ended mixed, while European indices ended up for the day.