Accessibility links

Breaking News

Economic Troubles Boost Budget Restaurants

The world economy's downturn is having contrary effects on two leading U.S. food retailers.

Shares in Starbucks, a chain of pricey coffee shops, fell more than three percent Tuesday, one day after it reported a 97 percent drop in profits in the 4th quarter of this year.

The value of Starbucks' shares has been falling sharply in recent months. Earlier this year, the Seattle, Washington-based company cut 1,000 jobs, shut 600 stores in the United States, and closed another 61 stores in Australia.

While coffee-drinkers are avoiding Starbucks' expensive products, budget hamburgers are selling briskly.

McDonald's announced Monday that its global sales jumped 8.2 percent in October.

McDonald's sales rose more than five percent in the United States, nearly 10 percent in Europe and more than 11 percent in the Asia-Pacific, Middle East and Africa.

Some information for this report was provided by AP and Reuters.