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U.S. market rally stalls

NEW YORK, Oct. 16 (UPI) -- A two-day rally in U.S. markets stalled early Friday after blue-chip Dow Jones components IBM and General Electric posted quarterly reports.

International Business Machines raised its annual earnings forecast, but its stock shares dropped on concerns of corporate technology spending, The Wall Street Journal reported. GE shares fell 3 percent as third-quarter revenue failed to meet expectations.

In late morning trading, the Dow Jones industrial average lost 1.04 percent, 104.52 points, to 9,958.42. The Standard & Poor's 500 lost 1.10 percent, 12.06 points, to 1,084.50. The Nasdaq composite index fell 1.21 percent, 26.31 points, to 2,146.98.

The benchmark 10-year Treasury rose 5/32 to yield 3.445 percent.

The euro fell to $1.4882 from Thursday's $1.4937. Against the yen, the dollar rose to 91.06 yen from Thursday's 90.60 yen.

In Tokyo, the Nikkie 225 average added 18.91 points, 0.18 percent, to 10,257.56.

Bank of America's Lewis to skip pay day

CHARLOTTE, N.C., Oct. 16 (UPI) -- Bank of America Chief Executive Officer Kenneth Lewis said he would forfeit his salary for 2009 amid new revelations over the purchase of Merrill Lynch.

The deal to buy Merrill Lynch has prompted investigations by the Securities and Exchange Commission, New York state and Congress, centering on critical information kept from shareholders before they voted to approve the merger last December.

Under pressure, Bank of America said it would waive its client-attorney privilege and reveal its attorneys' advice on the Merrill Lynch deal.

Documents to be handed to investigators are expected to shed light on the advice given to the bank by the legal firm of Wachtell, Lipton, Rosen & Katz, The New York Times reported Thursday.

Four sources said lawyers advised the bank not to tell shareholders about the depth of Merrill Lynch's losses, the Times said.

Lewis took part in discussions with bank executives, including Chief Financial Officer Joe Price and concluded shareholders did not need to be told of the losses, the Times said.

"I'm taken aback by the advice. When shareholders are asked to vote, they deserve a fine-tuned picture," said Donald Langevoort, a professor at Georgetown Law.

China Sept. fiscal revenues up 33 percent

BEIJING, Oct. 16 (UPI) -- China's September fiscal revenue totaled $82.17 billion, up 33 percent from the same month last year, the Finance Ministry said Friday.

It was the fifth month in a row revenues had risen, the ministry said, attributing it to domestic economic recovery, Xinhua reported.

September fiscal expenditure rose 32.9 percent to $96.4 billion.

Fiscal revenue in the first three quarters of this year rose 5.3 percent to $754.4 billion and expenditures in the same period rose 24.1 percent to $662 billion.

China is now the world's third largest economy after the United States and Japan but soon is expected to take second place.

Since 1949 when the People's Republic of China was founded, the country's annual fiscal revenues have risen more than 1,000 times to $899 billion in 2008. Since 1978, China's gross domestic product has grown at an annual rate of 9.8 percent.

Google's bookstore may shake up market

MOUNTAIN VIEW, Calif., Oct. 16 (UPI) -- U.S. Internet giant Google's online bookstore, Google Editions, looks like a potential game changer for the electronic book industry, a reviewer wrote.

Google's outlet will resist the temptation of tying access to Google Editions books to a specific reading device, such as a Kindle, PC World reported Friday. Instead, the launch of 500,000 titles in the first half of 2010 will be available through a variety of hand held and desktop devices.

"To me this sounds like Google wants to turn the e-book, or more accurately the e-reader, into a Web App," wrote reviewer Ian Paul.

Others digital outlets, such as Buy Ebook and eBooks.com, have content available that is "unchained" from a specific gadget, however, "whenever Google gets involved with any new business, the immediate assumption is that the company will be able to reshape the market," Paul wrote.