James Dicks Daily Digest - January 23, 2009
President Obama and top Democrats and Republicans from the House and Senate are meeting to discuss the status of the spending and tax cutting legislation that Obama has demanded to confront an ever weakening economy. The stimulus legislation, priced at about $825 billion and likely to grow, advanced in House committees this week. Republicans were unable to make inroads with their proposals.
Treasury Secretary-designate Timothy Geithner says President Obama believes China is "manipulating" its currency, a declaration that American manufacturers have long sought in their efforts to combat America's soaring trade deficit with China.
The British economy has officially fell into recession with output falling 1.5 percent in the fourth quarter of last year as the financial crisis ravaged banks, retail and manufacturing. It was the largest decline since Margaret Thatcher's government nearly 30 years ago and prompted an active session of selling of the pound.
The Federal Housing Finance Agency plans to propose new financial requirements next week for Fannie Mae (FNM), Freddie Mac (FRE) and the 12 Federal Home Loan Banks. The regulatory agency may place new restrictions on Fannie and Freddie’s investments and will revamp capital requirements for the home loan banks.
John Thain resigned under pressure from Bank of America (BAC) after reports he rushed out billions of dollars in bonuses to Merrill Lynch employees in his final days as CEO there, while the brokerage was suffering huge losses and just before Bank of America took it over. The bonuses were paid before Bank of America's acquisition of Merrill became final on Jan. 1st.
Chrysler LLC, which suffered a 30% drop in sales last year, announced a massive new incentive program to move vehicles off dealers' lots. The carmaker will begin marketing the incentive plans, called "Employee Pricing Plus," in ads next week. Customers will reportedly receive discounts of up to $3,500 on 2009 vehicles and $6,000 on 2008 models.
Aflac Inc. (AFL), the largest seller of supplemental insurance, said it had at least $500 million in excess capital as of Dec. 31st and doesn’t need to raise more. The insurer also said that it expects to maintain its dividend this year.
Scheduled U.S. Economic Reports (Next Week)
Existing Home Sales (Dec), Leading Indicators (Dec), Case-Schiller Home Prices (Nov), Consumer Confidence ((Jan), Durable Goods Orders (Dec). New Home Sales (Dec), Gross Domestic Product (Q4), Employment Cost Index (Q4), Chicago PMI (Jan), Consumer Sentiment (Jan) and the FOMC Meeting.
In Earnings News
General Electric Co.'s (GE) fourth-quarter net income fell 46 percent. GE reported earnings of $3.65 billion, or 35 cents per share, after paying preferred dividends. That was down from $6.7 billion, or 66 cents per share, a year earlier. GE's earnings matched the consensus of analysts for 37 cents a share.
Xerox (XRX) reported earnings fell to $1 million, or break-even per share, for the quarter, from year-ago profit of $382 million, or 41 cents per share. Analysts, who typically exclude one-time charges from their estimates, expected higher profit of 34 cents per share.
Harley Davidson (HOG) reported fourth-quarter profit fell 58 percent to $77.8 million, or 34 cents per share. The results fell short of Wall Street estimates. Analysts surveyed by expected 57 cents per share.
Schlumberger (SLB) reported its fourth-quarter earnings fell nearly 17 percent as the energy industry pulled back on spending. The company said its net profit for the October-December period was $1.15 billion. Analysts expected a profit of $1.05 per share.
Scheduled Earnings Reports (Next Week)
American Express, Boeing, McDonalds, Halliburton, Tyson Foods, Bristol Myers Squibb, DuPont, Sun Microsystems, US Steel, AT&T, AirTran Holdings, General Dynamics, New York Times, Pfizer, Wells Fargo, 3M, 1-800-Flowers, Altria, Fortune Brands, Amazon.com, Occidental Petroleum, Royal Caribbean Cruises
Stocks in the News
Geron Corp (GERN) traded higher after the FDA granted clearance for it to begin trials for what it said was the world's first study of a human embryonic stem cell-based therapy for people.
Wyeth (WYE) reported that Pfizer is in talks to acquire the rival drugmaker in a deal that could be worth more than $60B.
Google (GOOG) reported its fourth-quarter net income fell sharply to $382 million, or $1.21 a share.
MEMC Electronic Materials (WFR) reported its fourth-quarter net income fell to $73.2 million or 33 cents a share.
Janus Capital Group (JNS) is leaving the institutional money-market business by April 30th.
Federated Investors (FII) said its fourth-quarter net income came in at $54.3 million, up slightly from a year earlier.
Capital One Financial (COF) reported a fourth-quarter net loss of $1.4 billion, or $3.74 per common share.
Rohm and Haas Co. (ROH) traded higher after it was announced that Dow Chemical was on the verge of getting approval from U.S. antitrust authorities to acquire the company.
Treasury Secretary-designate Timothy Geithner says President Obama believes China is "manipulating" its currency, a declaration that American manufacturers have long sought in their efforts to combat America's soaring trade deficit with China.
The British economy has officially fell into recession with output falling 1.5 percent in the fourth quarter of last year as the financial crisis ravaged banks, retail and manufacturing. It was the largest decline since Margaret Thatcher's government nearly 30 years ago and prompted an active session of selling of the pound.
The Federal Housing Finance Agency plans to propose new financial requirements next week for Fannie Mae (FNM), Freddie Mac (FRE) and the 12 Federal Home Loan Banks. The regulatory agency may place new restrictions on Fannie and Freddie’s investments and will revamp capital requirements for the home loan banks.
John Thain resigned under pressure from Bank of America (BAC) after reports he rushed out billions of dollars in bonuses to Merrill Lynch employees in his final days as CEO there, while the brokerage was suffering huge losses and just before Bank of America took it over. The bonuses were paid before Bank of America's acquisition of Merrill became final on Jan. 1st.
Chrysler LLC, which suffered a 30% drop in sales last year, announced a massive new incentive program to move vehicles off dealers' lots. The carmaker will begin marketing the incentive plans, called "Employee Pricing Plus," in ads next week. Customers will reportedly receive discounts of up to $3,500 on 2009 vehicles and $6,000 on 2008 models.
Aflac Inc. (AFL), the largest seller of supplemental insurance, said it had at least $500 million in excess capital as of Dec. 31st and doesn’t need to raise more. The insurer also said that it expects to maintain its dividend this year.
Scheduled U.S. Economic Reports (Next Week)
Existing Home Sales (Dec), Leading Indicators (Dec), Case-Schiller Home Prices (Nov), Consumer Confidence ((Jan), Durable Goods Orders (Dec). New Home Sales (Dec), Gross Domestic Product (Q4), Employment Cost Index (Q4), Chicago PMI (Jan), Consumer Sentiment (Jan) and the FOMC Meeting.
In Earnings News
General Electric Co.'s (GE) fourth-quarter net income fell 46 percent. GE reported earnings of $3.65 billion, or 35 cents per share, after paying preferred dividends. That was down from $6.7 billion, or 66 cents per share, a year earlier. GE's earnings matched the consensus of analysts for 37 cents a share.
Xerox (XRX) reported earnings fell to $1 million, or break-even per share, for the quarter, from year-ago profit of $382 million, or 41 cents per share. Analysts, who typically exclude one-time charges from their estimates, expected higher profit of 34 cents per share.
Harley Davidson (HOG) reported fourth-quarter profit fell 58 percent to $77.8 million, or 34 cents per share. The results fell short of Wall Street estimates. Analysts surveyed by expected 57 cents per share.
Schlumberger (SLB) reported its fourth-quarter earnings fell nearly 17 percent as the energy industry pulled back on spending. The company said its net profit for the October-December period was $1.15 billion. Analysts expected a profit of $1.05 per share.
Scheduled Earnings Reports (Next Week)
American Express, Boeing, McDonalds, Halliburton, Tyson Foods, Bristol Myers Squibb, DuPont, Sun Microsystems, US Steel, AT&T, AirTran Holdings, General Dynamics, New York Times, Pfizer, Wells Fargo, 3M, 1-800-Flowers, Altria, Fortune Brands, Amazon.com, Occidental Petroleum, Royal Caribbean Cruises
Stocks in the News
Geron Corp (GERN) traded higher after the FDA granted clearance for it to begin trials for what it said was the world's first study of a human embryonic stem cell-based therapy for people.
Wyeth (WYE) reported that Pfizer is in talks to acquire the rival drugmaker in a deal that could be worth more than $60B.
Google (GOOG) reported its fourth-quarter net income fell sharply to $382 million, or $1.21 a share.
MEMC Electronic Materials (WFR) reported its fourth-quarter net income fell to $73.2 million or 33 cents a share.
Janus Capital Group (JNS) is leaving the institutional money-market business by April 30th.
Federated Investors (FII) said its fourth-quarter net income came in at $54.3 million, up slightly from a year earlier.
Capital One Financial (COF) reported a fourth-quarter net loss of $1.4 billion, or $3.74 per common share.
Rohm and Haas Co. (ROH) traded higher after it was announced that Dow Chemical was on the verge of getting approval from U.S. antitrust authorities to acquire the company.
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