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May 7, 2012 at 8:04 PM
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Dow slides after French election

NEW YORK, May 7 (UPI) -- U.S. stocks closed mixed Monday in response to French voters electing a socialist president during the weekend.

Francois Hollande will replace President Nicolas Sarkozy, who worked with German Chancellor Angela Merkel to establish new ground rules for government finances in the European Union and pushed for tough austerity budget strategies.

Stocks tumbled in parts of Asia and were mixed in Europe, with stocks rising in France and Italy. Declines were seen in Britain, Germany and Sweden.

By close of trading on Wall Street, the Dow Jones industrial average shed 29.74 points or 0.23 percent to 13,008.53. The tech-heavy Nasdaq composite index gained 1.42 points or 0.05 percent to 2,957.76. The Standard & Poor's 500 index gained 0.48 points or 0.04 percent to 1,369.58.

On the New York Stock Exchange, 1,652 stocks advanced and 1,379 declined on a volume of 3.4 billion shares traded.

The 10-year benchmark treasury note rose 1/32 to yield 1.881 percent.

The euro fell to $1.305 from Friday's $1.3084. Against the yen, the dollar fell to 79.92 yen from 80.17 yen.

In Tokyo, the Nikkei 225 index dropped 2.78 percent, 261.11, to 9,119.14.

In London, the FTSE 100 index lost 1.93 percent, 111.49, to 5,655.06.

Largarde calls for strategic balance

WASHINGTON, May 7 (UPI) -- International Monetary Fund Director Christine Lagarde said labor and market reforms in Europe could add 4.5 percent to the region's gross domestic product.

"Some preliminary analysis by the IMF for the euro-area countries suggests that over five years, large-scale product market, labor and pension reforms could boost GDP by 4.5 percent," she said in an address entitled, "Anchoring Stability to Sustain Higher and Better Growth."

Just after voters elected a socialist president in France to replace austerity-advocate Nicolas Sarkozy, the IMF issued a statement in which Lagarde called for a balance between stimulus spending and reducing debt.

"We know that fiscal austerity holds back growth, and the effects are worse in downturns, so the right pace is everything -- and the right pace will be country specific," said Lagarde, who was the finance minister in France taking the directorship at the IMF.

"So again, there's no avoiding this brake of fiscal adjustment," she said referring to austerity budget strategies.

"But if calibrated correctly, we can make sure it doesn't do too much harm to growth," she said.

The other two brakes, weak banks and poor housing markets, must be addressed at country and regional levels, Lagarde said.

Brazil second only to U.S. in Facebook use

RIO DE JANEIRO, May 7 (UPI) -- Brazil has surpassed India in the number of Facebook users, with more than 46 million, and is second only to the United Sates, a marketing survey indicates.

Facebook overtook Google last month to become the most visited site by Internet users in Brazil, social marketing firm Socialbakers reported, pushing the country's Facebook numbers past those of India.

The United States remains on top with more than 157 million Facebook users, but India has fallen to third with 45 million, ZDNet.com reported Monday.

There has been an estimated 22 percent increase in Facebook use in Brazil in last three months, the Socialbakers survey found.

"The practice of monitoring Facebook's development across various geographies usually reveals interesting trends and ideas about new Facebook leaders based on their number of monthly active users," a Socialbakers representative said in a statement.

Much of the increase in Facebook usage in Brazil is attributable to companies using the social networking site to build brand awareness, Socialbakers said.

"Our data show that businesses are naturally focusing their marketing activities at places with the highest customer concentration," the representative said.

China launches independent deep water rig

BEIJING, May 7 (UPI) -- The China National Offshore Oil Corp. said Monday it was ready to put its first Chinese-developed, deep-water drilling rig into operation.

The firm said the rig would be operational Wednesday and called the launch "a substantial step," as it is the first independent deep-water platform developed in China.

China's official Xinhua news agency reported the semi-submersible rig would be put to use 200 miles southeast of Hong Kong in waters about 1 mile deep.

Oil reserves under the South China Sea are estimated at 23 billion metric tons to 30 billion with natural gas reserves of 16 trillion cubic meters.

The area contains about a third of China's oil and gas reserves.

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