%1

A Facebook stock collapse wiped out $119 billion in market value on Thursday in one of the worst single-day losses in history, The Associated Press reported. Facebook’s drop pulled technology stocks lower on Wall Street, even as other sectors climbed. The losses came after the company warned of slower growth ahead. Renewed optimism that the U.S. and Europe might make progress on easing trade tensions helped send several companies higher. Strong earnings reports also helped send stocks higher. Airlines, energy companies and consumer goods stocks rose. Small-company stocks did better than the rest of the market. The S&P 500 index slipped 8 points, or 0.3 percent, to 2,837. The Dow Jones Industrial Average rose 112 points, or 0.4 percent, to 25,527. The Nasdaq composite slid 80 points, or 1 percent, to 7,852.

Foreign purchases of U.S. homes had their biggest drop ever, bringing relief to waves of American house hunters who have struggled to compete in affluent neighborhoods with wealthy buyers from abroad, The Wall Street Journal reported. Purchases by international buyers totaled $121 billion in the fiscal year ended in March, down from $153 billion the previous year, according to a survey released Thursday. That 21 percent decline was the largest on record. The drop in foreign interest helps well-heeled buyers in places like Manhattan, Seattle, San Francisco, Miami, and Orange County, Calif. While foreigners make up a small share of the overall U.S. housing market, they are concentrated near the high end of the market and are more likely to pay in cash and bid above the asking price, which has challenged local buyers to come up with larger down payments and pay more. The sharp decline in purchases reflected higher home prices, a strengthening dollar and intensifying political tensions between the U.S. and other parts of the world, economists say. The pullback creates an additional challenge for many sellers, who have welcomed foreign interest and the ease of all-cash deals. The housing market is already slowing, especially for developers of higher-end condos, some of whom heavily marketed their units to foreign investors.

Wall Street just traversed a gauntlet: the busiest week of corporate quarterly results, fresh developments in global trade relations and a historic stock tumble by Facebook Inc., MarketWatch reported. However, the headliner of this jam-packed week might be the release of the GDP, the official scorecard of the U.S. economy. As one fixed-income strategist put it, never has a reading of gross domestic product held so much significance, with the three main equity benchmarks — the Dow Jones Industrial Average, the S&P 500 index and the Nasdaq Composite Index — as well as the U.S. dollar and Treasury markets primed for Friday’s highly anticipated print. Here’s how Guy LeBas, head of fixed-income strategy for Janney Montgomery Scott, put it via Twitter on Thursday: “I can’t remember the last time the markets placed such importance on a #GDP number as they have with tomorrow. Given the perceived optimism, a miss could catch rates violently offside (i.e., rally risk),” he wrote. What’s all the fuss about? Second-quarter GDP data might reflect one of the fastest rates of economic expansion since a 5.2 percent print in the third quarter of 2014, and if it comes out ahead of that figure, it would be the best GDP report since 2003. Growing buzz around the possibility of such a strong read comes as the White House has been suggesting that the number from the Commerce Department will be huge.

A bankruptcy court judge approved a settlement between iHeartMedia Inc. and the company’s largest creditor groups that will allow it to hire both Moelis & Co. and LionTree Advisors LLC as investment banks, but at a lower fee, according to court filings, WSJ Pro reported. The ad hoc group of term loan and priority guarantee noteholders and iHeart’s unsecured creditors’ committee have been fighting the company on hiring both Moelis and LionTree for months, arguing that two advisers aren’t needed and that their fees are too high. Under the settlement reached between the radio station operator and the creditor groups, the two firms capped their total fees at $67.5 million, with at least $10 million going to LionTree and $57.5 million going to Moelis, according to court filings. The two firms were set to earn around $90 million in total under their original fee applications. Moelis could have earned over $70 million under the original payment structure, including a $30 million fee paid upon confirmation of a chapter 11 reorganization plan and another $35 million fee paid if the company raised any debt or equity as part of a confirmed plan. iHeart filed for bankruptcy in March with a plan to slash $10 billion of its total $16 billion in debt at the company’s broadcast radio division. Judge Marvin Isgur of the U.S. Bankruptcy Court in Houston is overseeing the case.

Chinese real-estate investors, facing pressure from Beijing, are reversing a yearslong buying spree in the U.S. where they often paid record prices for marquee properties, The Wall Street Journal reported. Chinese insurers, conglomerates and other investors have turned net sellers of U.S. commercial real estate for the first time in a decade. They have spent tens of billions of dollars to acquire hotels, office buildings, and vast swaths of empty land to build residential towers, but Chinese investors sold $1.29 billion worth of U.S. commercial real estate in the second quarter while purchasing only $126.2 million of property. This marked the first time that these investors were net sellers for a quarter since 2008. The more than $1 billion in net sales reflects how much the Chinese government’s attitude toward investing overseas has changed in recent months. Chinese investors began scooping up U.S. real estate a few years ago after Beijing officials loosened restrictions on foreign investment. They quickly made their mark in U.S. cities like Los Angeles, San Francisco and Chicago with high-profile acquisitions, including the $1.95 billion purchase of the Waldorf Astoria in New York, the highest price ever paid for a U.S. hotel. Now, the Chinese government has changed course again, cracking down on certain types of outbound investment that include real estate in part to help stabilize the currency. Chinese companies are unloading prize properties to repay debt and to comply with regulatory and market pressures from home. Analysts say that increasing tensions over trade and national security between China and the U.S. also have contributed to the pullback. The retreat by Chinese investors could slow growth further in the U.S. commercial real estate market. Property values have plateaued on average in the last 18 months after rising sharply in the early years of the post-2008 financial crisis recovery.

In the maze of subsidiaries that make up Goldman Sachs Group, two in London have nearly identical names: Goldman Sachs International and Goldman Sachs International Bank, the New York Times reported. Both trade financial instruments known as derivatives with hedge funds, insurers, governments and other clients. U.S. regulators, however, get detailed information only about the derivatives traded by Goldman Sachs International. Thanks to a loophole in laws enacted in response to the financial crisis, trades by Goldman Sachs International Bank don’t have to be reported. A decade after a financial crisis fueled in part by a tangled web of derivatives, regulators still have an incomplete picture of who holds what in this $600 trillion market. “It’s a global market, so you really have to have a global set of data,” said Werner Bijkerk, the former head of research at the International Organization of Securities Commissions. “You can start running ‘stress tests’ and see where the weaknesses are. With this kind of patchwork, you will never be able to see that.” The 2010 Dodd-Frank law was supposed to improve regulators’ ability to monitor derivatives. American banks had to start reporting specifics about their trades, including whom they traded with, to the Commodity Futures Trading Commission. The goal was to prevent a recurrence of the financial crisis, when fatal problems at Lehman Brothers caused a tidal wave of troubles at other banks that were connected through derivatives. In part because nobody could map out those connections, nobody knew where problems lurked, and fearful banks stopped lending to one another. But the Dodd-Frank Act contained a big gap: Banks don’t have to disclose to American regulators their holdings of derivatives housed in certain offshore entities. The critical variable is whether the American parent company is legally on the hook to bail out its foreign subsidiary if it gets into trouble. As long as the answer is “no,” the foreign entity isn’t subject to the Dodd-Frank requirements.

Oaktree Capital Management LP said it has made a better offer for bankrupt Claire’s Stores Inc. than one on the table but acknowledged that financing isn’t finalized, a fact seized upon by the current lead bidder for the teen retailer, WSJPro reported. Oaktree, an unhappy bondholder in Claire’s bankruptcy, also is seeking court approval to sue the retailer and backer Apollo Management Holdings LP, alleging that intellectual property was fraudulently transferred to new entities not part of the chapter 11 proceedings, according to a filing Thursday in U.S. Bankruptcy Court in Wilmington, Del. Claire’s filed for bankruptcy in March. Since then, Oaktree, which holds $159 million in secured second-lien notes in the Hoffman Estates, Ill.-based company, has said the teen accessories chain continues to favor senior bondholders and investment firm Apollo, which owns equity in the teen accessories merchant as well as some of its debt, at the expense of other parties. Claire’s and several related companies filed for bankruptcy with a plan to hand the equity in the reorganized company to first-lien bondholders when it exits bankruptcy. Oaktree has said that Claire’s hasn’t done enough to market its assets, which would help creditors recover more of what they are owed. In a win for Oaktree last month, Judge Mary Walrath in the Delaware court ordered Claire’s to open up the sale of the company to all bidders, setting an Aug. 31 deadline.