2014 10 24 cmyk na 04 - the wall street...

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YELLOW ****** FRIDAY, OCTOBER 24, 2014 ~ VOL. CCLXIV NO. 98 WSJ.com HHHH $2.00 DJIA 16677.90 À 216.58 1.3% NASDAQ 4452.79 À 1.6% NIKKEI 15138.96 g 0.4% STOXX 600 328.26 À 0.7% 10-YR. TREAS. g 12/32 , yield 2.276% OIL $82.09 À $1.57 GOLD $1,228.50 g $16.30 EURO $1.2647 YEN 108.27 TODAY IN MANSION Homes on the (Giant) Range ARENA Everybody’s a Curator Hall and Hall Partners CONTENTS Art.................................. D2,7 Corporate News... B2-4 Global Finance............ C3 Heard on the Street C8 In the Markets....... C4,5 Movies........................ D3-5 Opinion................... A11-13 Television...................... D8 Theater ....................... D7,9 Sports ........................... D10 U.S. News................. A2-5 Weather Watch........ B6 World News ........... A6-9 s Copyright 2014 Dow Jones & Company. All Rights Reserved > What’s News i i i World-Wide n A doctor in New York who had treated Ebola patients in West Africa tested positive for the virus, setting up a new front in the U.S.’s attempt to control the disease’s spread. A1 n Researchers will test the effectiveness of transfusing blood products from Ebola sur- vivors into infected patients. A5 n The gunman who killed a Canadian soldier had sought a passport to travel to Syria, investigators said. A1 n The shooting is prompting a review of Canada’s security and intelligence protocols. A7 n Democrats are failing to draw enough support from women in three key Senate races, recent polls suggest. A4 n China’s Communist Party vowed to improve the legal system, even as it reasserted dominance over the courts. A8 n EU leaders agreed on a set of long-term targets on energy and climate change. A8 n Israelis and Palestinians staged angry demonstrations a day after a Palestinian driver killed an Israeli infant. A6 n A review of photos smug- gled out of Syria that appear to show prison torture has identi- fied only a few victims. A6 n Qatar and Kuwait are too lax about Islamic State financ- ing activities, the U.S. said. A6 n South Carolina’s House speaker quit and admitted cam- paign-finance violations. A2 n Archaeologists uncovered perhaps the world’s highest and oldest Ice Age settlement in the Peruvian Andes. A9 i i i A mazon’s loss widened to $437 million, its worst in 14 years, as the company’s am- bitious expansion plans hurt the bottom line. Shares slid 12% in after-hours trading. A1 n A Comcast executive took aim at HBO over its planned streaming-video service, saying the move could cannibalize a lucrative pay-TV business. B1 n Microsoft’s revenue, ex- cluding its recently acquired Nokia business, rose 11% last quarter as the company out- paced corporate-tech rivals. B1 n U.S. stocks rallied, aided by better-than-expected earnings reports. The Dow climbed 216.58 points to 16677.90. C1 n GM’s sales in North Amer- ica helped the auto maker earn a $1.47 billion profit before deferred payouts. B3 n U.S. airlines posted soaring profits and forecast a strong fourth quarter on falling fuel prices and strong demand. B4 n Coke is replacing its mar- keting chief with the head of its Iberian business as it seeks to improve poor soda sales. B1 n Tesco said its chairman would step down as the U.K. retailer disclosed more ac- counting problems. B2 n Audi recalled A4 sedans be- cause of a software glitch af- fecting air bags. Honda named a new safety executive. B3 n Rengan Rajaratnam agreed to pay over $840,000 to settle a civil insider-trading case. C2 n Caterpillar reported a sur- prise profit jump, aided by cost cuts and locomotive sales. B4 Business & Finance Three weeks before Michael Zehaf-Bibeau killed a Canadian soldier and thrust the govern- ment into a terrified lockdown on Wednesday, he came to Ot- tawa to get a passport so he could travel to Syria, police said. On Tuesday, he prayed and slept in a downtown hostel for the homeless where he had been staying. A number of details about Mr. Zehaf-Bibeau emerged Thursday that began to fill in a picture of a middle-class suburban youth who grew estranged from his family—last week he had lunch with his mother, Susan Bibeau, a federal civil servant he hadn’t seen in five years—and de- scended into a string of petty crimes. What authorities couldn’t yet answer was why that led to the attack. “I think the passport figured prominently in his motives,” said Bob Paulson, the commissioner of the Royal Canadian Mounted Police. Investigators learned of his plans to travel to Syria from his estranged mother on Wednesday, the RCMP said, after the shooting and his own death. Mr. Zehaf-Bibeau was on ra- dar of Canadian intelligence and deemed a man “down on life,” according to one person familiar with the investigation. But he wasn’t on a list of 90 Canadians deemed “high-risk” travelers be- cause of their potential for ter- ror links abroad, according to the RCMP. He may have had links, how- ever, to one such person. Investi- gators said they are probing a possible connection to a Vancou- ver-area man who is believed to have traveled to Syria. That man is Hasibullah Yusufzai, according to a U.S. official. In July, Mr. Yusufzai became the first person charged in Can- ada under a law passed last Please turn to page A7 By Alistair MacDonald in Toronto, Paul Vieira in Ottawa and Siobhan Gorman in Washington Gunman’s Journey to Terror Shooter Sought Passport to Syria Before Attack; Earlier Years Marked With Petty Crimes Chris Wattie / Reuters Amazon’s Spending Binge Leads to a Large Loss Over the past few years, Helen Nonini, a 35-year- old executive in Milan, has sold off most of her once- beloved Gucci handbags and accessories. She even got rid of a roomy Gucci travel satchel she received as a gift. “I just don’t want to be categorized,” says Ms. Nonini. “I don’t want someone in the street to look at me and know right away who designed the bag I’m carrying or how much I paid for it.” Lately she has been favoring other big-ticket, albeit logo-less, labels like Bottega Veneta. Winning back customers like Ms. Nonini—many of whom are unexcited by the luxury brands that BY MANUELA MESCO LOSING LUSTER Gucci Finds Its Brand Of Luxury a Tough Sell Amazon.com Inc.’s soaring ambitions are coming at a steep cost, dragging the e-commerce giant to its largest quarterly loss in 14 years. A surge in spending on new- product development, music and video licensing, and other parts of the Seattle company’s expan- sion strategy led to a net loss of $437 million in the third quarter, worse than its year-earlier loss of $41 million. The wider loss came despite a 20% jump in rev- enue to $20.58 billion. In another stumble, Amazon took a $170 million charge on its Amazon Fire smartphone, which was released in July but is sell- ing poorly, analysts say. The company also issued a lukewarm sales forecast for the current quarter, its most important of the year because of holiday-re- lated spending. Investors punished Amazon for the disappointing results, re- leased after the close of regular trading Thursday. In after-hours trading, its shares skidded 12%, or $33.43, to $279.75, their low- BY GREG BENSINGER SAN FRANCISCO—The most closely guarded assets at AT&T Park are hidden just behind the center-field wall. A massive over- head net shields them from fall- ing baseballs, and a group of minders keeps eager fans from getting too close. They are the stars of the San Francisco Giants’ farm system: ra- dicchio, cilantro, sorrel and kale. And don’t overlook the tarragon, Swiss chard, lemon grass and sage. Just steps from the field where the World Series will resume with Game 3 on Friday night, more than two dozen vegetables, herbs and fruits are growing in the Gi- Please turn to page A10 BY BRIAN COSTA In World Series, Giants Field a Vegetable Patch i i i Team’s Garden Has Lots of Fans; No Stealing provided a thrill for so long—is an uphill battle for Gucci, whose red-hot growth has sputtered. On Thursday, Gucci’s parent, Kering SA, said third-quarter sales for the brand declined 1.6% com- pared with the same period a year ago. Overall sales at the luxury conglomerate rose by 3.3%, to €2.6 bil- lion ($3.29 billion). Those results are part of a continuing trend. Ac- cording to Bain, global sales growth of accessories such as handbags and shoes has been decelerating. They grew by 7% last year, compared with 16% in 2012, and are expected to rise 5% this year. The travails of Gucci, whose sleek stores and cov- eted goods helped fuel the rise of luxury mega- Please turn to page A10 Canadian lawmakers gave a hero’s welcome to Kevin Vickers, sergeant-at-arms of the House of Commons, one day after he shot the gunman. Microsoft outpaces peers......... B1 Security under review .............. A7 est level since June 2013. Amazon’s chief financial of- ficer, Tom Szkutak, struck a more cautious tone in a confer- ence call with reporters than he has in the past, suggesting that the fast-moving company might be forced to get choosier about where it invests. “We do have a lot of opportu- nities in front of us,” he said. “We certainly have been in sev- eral years now of what I will call an investment mode, but we know that we have to be very se- lective about which opportuni- ties we pursue.” For years, Amazon won the devotion of investors with quar- ter after quarter of skyrocketing sales and optimism about long- term projects seen as generators of even more growth. But skepti- cism about the payoff from some of the investments has been growing, and the company’s shares had sunk 21% since the start of this year before Amazon reported its results Thursday. So far in 2014, Amazon has Please turn to the next page A doctor who had returned to New York City recently after treating Ebola patients in West Africa tested positive for the vi- rus on Thursday, officials said, setting up a new front in the na- tion’s attempt to control the spread of the deadly disease. Craig Spencer, a 33-year-old physician who had worked with Doctors Without Borders in Guinea until returning to the U.S. a week ago, is the fourth patient to be diagnosed with Ebola in the U.S. and the ninth to be treated here. Dr. Spencer called the New York City Department of Health and Mental Hygiene at about 11:52 a.m. to report that he had a fever and gastrointestinal prob- lems, and had quarantined him- self inside a fifth-floor apart- ment on West 147th Street in Manhattan, authorities said. A Fire Department of New York hazardous materials team put Dr. Spencer in an exposure suit and transported him to Bellevue Hos- pital Center, the official said. He tested positive less than three weeks after Liberian Thomas Eric Duncan, the first person diag- nosed on U.S. soil, died on Oct. 8. The subsequent Ebola diagnoses of two nurses who treated Mr. Dun- can raised concerns that the na- tion’s medical systems weren’t well-equipped to stop the spread Please turn to page A5 By Josh Dawsey, Andrew Tangel and Betsy McKay New York Physician Contracts Ebola Narrowing Gender Gap Aids GOP UNDER PRESSURE: Recent polls suggest the Democrats are failing to draw enough support from women in three key Senate races, including in Colorado, where Sen. Mark Udall, above, faces a tough fight. A4 Associated Press New policies at U.S. schools... A5 Travel delays hit Africa effort... A5 Study to test transfusions..... A5 C M Y K Composite Composite MAGENTA CYAN BLACK P2JW297000-6-A00100-10EFFB7178F CL,CX,DL,DM,DX,EE,EU,FL,HO,KC,MW,NC,NE,NY,PH,PN,RM,SA,SC,SL,SW,TU,WB,WE BG,BM,CC,CH,CK,CP,CT,DN,DR,FW,HL,HW,KS,LA,LG,LK,MI,ML,NM,PA,PI,PV,TD,TS,UT,WO P2JW297000-6-A00100-10EFFB7178F

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Page 1: 2014 10 24 cmyk NA 04 - The Wall Street Journalonline.wsj.com/public/resources/documents/PageOne102414.pdfGucci, whose red-hot growth has sputtered. On Thursday, Gucci’sparent, Kering

YELLOW

* * * * * * FRIDAY, OCTOBER 24, 2014 ~ VOL. CCLXIV NO. 98 WSJ.com HHHH $2 .00

DJIA 16677.90 À 216.58 1.3% NASDAQ 4452.79 À 1.6% NIKKEI 15138.96 g 0.4% STOXX600 328.26 À 0.7% 10-YR. TREAS. g 12/32 , yield 2.276% OIL $82.09 À $1.57 GOLD $1,228.50 g $16.30 EURO $1.2647 YEN 108.27

TODAY IN MANSION

Homes on the (Giant) RangeARENA Everybody’s a Curator

Halland

HallPartners

CONTENTSArt.................................. D2,7Corporate News... B2-4Global Finance............ C3Heard on the Street C8In the Markets....... C4,5Movies........................ D3-5

Opinion................... A11-13Television...................... D8Theater....................... D7,9Sports........................... D10U.S. News................. A2-5Weather Watch........ B6World News........... A6-9

s Copyright 2014 Dow Jones & Company.All Rights Reserved

>

What’sNews

i i i

World-Widen A doctor in New York whohad treated Ebola patients inWest Africa tested positive forthe virus, setting up a newfront in the U.S.’s attempt tocontrol the disease’s spread. A1n Researchers will test theeffectiveness of transfusingblood products fromEbola sur-vivors into infected patients.A5n The gunman who killed aCanadian soldier had soughta passport to travel to Syria,investigators said. A1n The shooting is promptinga review of Canada’s securityand intelligence protocols. A7nDemocrats are failing todraw enough support fromwomen in three key Senateraces, recent polls suggest. A4n China’s Communist Partyvowed to improve the legalsystem, even as it reasserteddominance over the courts. A8n EU leaders agreed on aset of long-term targets onenergy and climate change. A8n Israelis and Palestiniansstaged angry demonstrationsa day after a Palestinian driverkilled an Israeli infant. A6nA review of photos smug-gled out of Syria that appear toshow prison torture has identi-fied only a few victims. A6nQatar and Kuwait are toolax about Islamic State financ-ing activities, the U.S. said. A6nSouth Carolina’sHousespeaker quit and admitted cam-paign-finance violations. A2nArchaeologists uncoveredperhaps the world’s highestand oldest Ice Age settlementin the Peruvian Andes. A9

i i i

Amazon’s loss widened to$437 million, its worst in

14 years, as the company’s am-bitious expansion plans hurtthe bottom line. Shares slid12% in after-hours trading. A1n A Comcast executive tookaim at HBO over its plannedstreaming-video service, sayingthe move could cannibalize alucrative pay-TV business. B1nMicrosoft’s revenue, ex-cluding its recently acquiredNokia business, rose 11% lastquarter as the company out-paced corporate-tech rivals. B1nU.S. stocks rallied, aided bybetter-than-expected earningsreports. The Dow climbed216.58 points to 16677.90. C1n GM’s sales in North Amer-ica helped the auto makerearn a $1.47 billion profitbefore deferred payouts. B3nU.S. airlines posted soaringprofits and forecast a strongfourth quarter on falling fuelprices and strong demand. B4n Coke is replacing its mar-keting chief with the head ofits Iberian business as it seeksto improve poor soda sales. B1n Tesco said its chairmanwould step down as the U.K.retailer disclosed more ac-counting problems. B2nAudi recalled A4 sedans be-cause of a software glitch af-fecting air bags. Honda nameda new safety executive. B3nRengan Rajaratnam agreedto pay over $840,000 to settlea civil insider-trading case. C2nCaterpillar reported a sur-prise profit jump, aided by costcuts and locomotive sales. B4

Business&Finance

Three weeks before MichaelZehaf-Bibeau killed a Canadiansoldier and thrust the govern-ment into a terrified lockdownon Wednesday, he came to Ot-tawa to get a passport so hecould travel to Syria, police said.On Tuesday, he prayed and sleptin a downtown hostel for thehomeless where he had beenstaying.

A number of details about Mr.Zehaf-Bibeau emerged Thursdaythat began to fill in a picture ofa middle-class suburban youthwho grew estranged from his

family—last week he had lunchwith his mother, Susan Bibeau, afederal civil servant he hadn’tseen in five years—and de-scended into a string of pettycrimes. What authoritiescouldn’t yet answer was whythat led to the attack.

“I think the passport figured

prominently in his motives,” saidBob Paulson, the commissionerof the Royal Canadian MountedPolice. Investigators learned ofhis plans to travel to Syria fromhis estranged mother onWednesday, the RCMP said, afterthe shooting and his own death.

Mr. Zehaf-Bibeau was on ra-dar of Canadian intelligence anddeemed a man “down on life,”according to one person familiarwith the investigation. But hewasn’t on a list of 90 Canadiansdeemed “high-risk” travelers be-cause of their potential for ter-

ror links abroad, according tothe RCMP.

He may have had links, how-ever, to one such person. Investi-gators said they are probing apossible connection to a Vancou-ver-area man who is believed tohave traveled to Syria. That manis Hasibullah Yusufzai, accordingto a U.S. official.

In July, Mr. Yusufzai becamethe first person charged in Can-ada under a law passed last

PleaseturntopageA7

By Alistair MacDonaldin Toronto,

Paul Vieira in Ottawaand Siobhan Gorman

in Washington

Gunman’s Journey to TerrorShooter SoughtPassport to SyriaBeforeAttack;EarlierYearsMarkedWithPettyCrimes

Chris

Wattie/Re

uters

Amazon’s Spending BingeLeads to a Large Loss

Over the past few years, Helen Nonini, a 35-year-old executive in Milan, has sold off most of her once-beloved Gucci handbags and accessories. She evengot rid of a roomy Gucci travel satchel she receivedas a gift.

“I just don’t want to be categorized,” says Ms.Nonini. “I don’t want someone in the street to lookat me and know right away who designed the bagI’m carrying or how much I paid for it.” Lately shehas been favoring other big-ticket, albeit logo-less,labels like Bottega Veneta.

Winning back customers like Ms. Nonini—manyof whom are unexcited by the luxury brands that

BY MANUELA MESCO

LOSING LUSTER

Gucci Finds Its BrandOf Luxury a Tough Sell

Amazon.com Inc.’s soaringambitions are coming at a steepcost, dragging the e-commercegiant to its largest quarterly lossin 14 years.

A surge in spending on new-product development, music andvideo licensing, and other partsof the Seattle company’s expan-sion strategy led to a net loss of$437 million in the third quarter,worse than its year-earlier lossof $41 million. The wider losscame despite a 20% jump in rev-enue to $20.58 billion.

In another stumble, Amazontook a $170 million charge on itsAmazon Fire smartphone, whichwas released in July but is sell-ing poorly, analysts say. Thecompany also issued a lukewarmsales forecast for the currentquarter, its most important ofthe year because of holiday-re-lated spending.

Investors punished Amazonfor the disappointing results, re-leased after the close of regulartrading Thursday. In after-hourstrading, its shares skidded 12%,or $33.43, to $279.75, their low-

BY GREG BENSINGER

SAN FRANCISCO—The mostclosely guarded assets at AT&TPark are hidden just behind thecenter-field wall. A massive over-head net shields them from fall-ing baseballs, and a group ofminders keeps eager fans fromgetting too close.

They are the stars of the SanFrancisco Giants’ farm system: ra-dicchio, cilantro, sorrel and kale.And don’t overlook the tarragon,Swiss chard, lemon grass andsage.

Just steps from the field wherethe World Series will resume withGame 3 on Friday night, morethan two dozen vegetables, herbsand fruits are growing in the Gi-

PleaseturntopageA10

BY BRIAN COSTA

InWorld Series,Giants Field aVegetable Patch

i i i

Team’s GardenHas Lots of Fans;

No Stealing

provided a thrill for so long—is an uphill battle forGucci, whose red-hot growth has sputtered.

On Thursday, Gucci’s parent, Kering SA, saidthird-quarter sales for the brand declined 1.6% com-pared with the same period a year ago. Overall salesat the luxury conglomerate rose by 3.3%, to €2.6 bil-lion ($3.29 billion).

Those results are part of a continuing trend. Ac-cording to Bain, global sales growth of accessoriessuch as handbags and shoes has been decelerating.They grew by 7% last year, compared with 16% in2012, and are expected to rise 5% this year.

The travails of Gucci, whose sleek stores and cov-eted goods helped fuel the rise of luxury mega-

PleaseturntopageA10

Canadian lawmakers gave a hero’s welcome to Kevin Vickers, sergeant-at-arms of the House of Commons, one day after he shot the gunman.

Microsoft outpaces peers......... B1

Security under review .............. A7

est level since June 2013.Amazon’s chief financial of-

ficer, Tom Szkutak, struck amore cautious tone in a confer-ence call with reporters than hehas in the past, suggesting thatthe fast-moving company mightbe forced to get choosier aboutwhere it invests.

“We do have a lot of opportu-nities in front of us,” he said.“We certainly have been in sev-eral years now of what I will callan investment mode, but weknow that we have to be very se-lective about which opportuni-ties we pursue.”

For years, Amazon won thedevotion of investors with quar-ter after quarter of skyrocketingsales and optimism about long-term projects seen as generatorsof even more growth. But skepti-cism about the payoff from someof the investments has beengrowing, and the company’sshares had sunk 21% since thestart of this year before Amazonreported its results Thursday.

So far in 2014, Amazon hasPleaseturntothenextpage

A doctor who had returned toNew York City recently aftertreating Ebola patients in WestAfrica tested positive for the vi-rus on Thursday, officials said,setting up a new front in the na-tion’s attempt to control thespread of the deadly disease.

Craig Spencer, a 33-year-oldphysician who had worked withDoctors Without Borders inGuinea until returning to the U.S.a week ago, is the fourth patientto be diagnosed with Ebola inthe U.S. and the ninth to betreated here.

Dr. Spencer called the NewYork City Department of Healthand Mental Hygiene at about11:52 a.m. to report that he had afever and gastrointestinal prob-lems, and had quarantined him-self inside a fifth-floor apart-ment on West 147th Street inManhattan, authorities said. AFire Department of New Yorkhazardous materials team put Dr.Spencer in an exposure suit andtransported him to Bellevue Hos-pital Center, the official said.

He tested positive less thanthree weeks after Liberian ThomasEric Duncan, the first person diag-nosed on U.S. soil, died on Oct. 8.The subsequent Ebola diagnoses oftwo nurses who treated Mr. Dun-can raised concerns that the na-tion’s medical systems weren’twell-equipped to stop the spread

PleaseturntopageA5

By Josh Dawsey,Andrew Tangeland Betsy McKay

New YorkPhysicianContractsEbola

Narrowing Gender Gap Aids GOP

UNDER PRESSURE: Recent polls suggest the Democrats are failing todraw enough support from women in three key Senate races, includingin Colorado, where Sen. Mark Udall, above, faces a tough fight. A4

AssociatedPress

New policies at U.S. schools... A5 Travel delays hit Africa effort... A5 Study to test transfusions..... A5

CM Y K CompositeCompositeMAGENTA CYAN BLACK

P2JW297000-6-A00100-10EFFB7178F CL,CX,DL,DM,DX,EE,EU,FL,HO,KC,MW,NC,NE,NY,PH,PN,RM,SA,SC,SL,SW,TU,WB,WEBG,BM,CC,CH,CK,CP,CT,DN,DR,FW,HL,HW,KS,LA,LG,LK,MI,ML,NM,PA,PI,PV,TD,TS,UT,WO

P2JW297000-6-A00100-10EFFB7178F