No recovery: U.S. ad agency employment showed a slight 0.4% increase in November over the previous month, but industry payrolls are not showing a recovery trend. Consolidations and layoffs have reduced industry employment to the level of early 1999. With the economy still lurching out of the recession, it could be at least a year before Madison Avenue sees significant improvement. The last recession ended in 1991 and ad spending began to grow in 1992, but agency employment didn't hit bottom till 1994.
More bad news: Slumping consumer confidence and industrial production, renewed war fears and a growing trade deficit weighed on investors late in the week, leading stocks to drop across the board. Only nine AdMarket stocks were up and 41 were down for the week.
General Motors Corp. and Sears, Roebuck & Co. rose after posting improved earnings, while McDonald's Corp. dropped after its new CEO vowed to stick with the low-margin Dollar Menu. Many technology stocks were punished after Microsoft Corp. cut earnings forecasts and several analysts reduced estimates for IBM Corp. Yahoo! dropped, even after reporting better-than-expected results, as investors worried the stock has gotten too expensive.