James Dicks Daily Digest - January 28, 2009
Boeing Co. (BA) just announced that it plans to slash about 10,000 jobs across its businesses, compared to a prior announcement of 4,500 job cuts from its commercial airplane unit. Job reductions will primarily occur in areas that support productivity and infrastructure, driven through a combination of attrition, retirements, cuts in some contracted labor, and layoffs.
The U.S. House is set to approve today President Obama’s proposed $816 billion economic stimulus package designed to pull the economy out of recession through a combination of tax cuts and $604 billion in spending.
The International Monetary Fund said the global economy is expected grow at the slowest pace since World War II this year. The economy is now expected to grow 0.5% in 2009 and to slowly rebound to 3% in 2010.
The two-day meeting of the Federal Open Market Committee (FOMC) ends today and with interest rates already set at basically zero, the focus is on any other commentary the Fed offers up on what they'll do to help spur the economy. The meeting ends around 2:15 pm (Eastern Time).
The Fed has a number of options to provide relief for distressed homeowners, including lowering the amount the homeowner owes on the mortgage, reducing the interest rate or lengthening the term of the loan. It is unclear how many homeowners would benefit. However, the relief plan would apply to the billions of dollars of mortgage assets the Fed is holding on its books because of last year's bailouts of Bear Stearns and insurer American International Group.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity plunged by 38.8 percent to 732.1 in the week ended Jan. 23rd. Fixed 30-year mortgage rates averaged 5.22 percent in the week, down from 5.24 percent the prior week and 4.89 percent in early January.
The Federal Deposit Insurance Corp. (FDIC) may manage the so-called “bad bank” that the Obama administration is likely to set up as it tries to break the back of the credit crisis. The bad-bank initiative may allow the government to rewrite some of the mortgages that underpin banks’ bad debt, in the hopes of stemming a crisis that has stripped more than 1.3 million Americans of their homes.
Scheduled U.S. Economic Reports (Thursday)
Initial Jobless Claims (Week of January 24th), Durable Goods (Dec), New Home Sales (Dec)
In Earnings News
Boeing Co. (BA) reported a fourth-quarter loss. Boeing reported a loss of $56 million, or 8 cents per share, for the last three months of 2008. Analysts, on average, expected earnings of 78 cents in the fourth quarter.
Wells Fargo & Co. (WFC) had a $2.83 billion loss in the fourth quarter. It reported a net loss of 79 cents per share, after paying preferred dividends. The results included several one-time items, including $5.6 billion, or 99 cents per share, of credit reserve build to cover future loan losses.
New York Times Co. (NYT), battling along with the rest of the newspaper industry to remain solvent during the financial meltdown, said its fourth quarter profit fell 48%. The company said fourth-quarter net income of $27.6 million, or 19 cents a share. On average, analysts expected a profit of 27 cents a share.
General Dynamics Corp. (GD) said its fourth-quarter earnings rose on higher profits in its business jet and shipbuilding units. The company posted net earnings of $612 million, or $1.57 per share. Analysts were expecting $1.59 per share.
AT&T Inc (T) earnings fell 23 percent is the latest quarter. The company earned $2.4 billion, or 41 cents per share, in the last three months of 2008. Analysts expected 42 cents a share.
ConocoPhillips (COP) lost $31.8 billion in the quarter. Net income for the October-December period amounted to a loss of $21.37 per share, compared with a profit of $4.4 billion, or $2.71 per share. Analysts expected earnings of $1.22 a share.
AirTran Holdings Inc. (AAI), parent of discount carrier AirTran Airways, announced its fourth-quarter loss widened to $118.4 million. AirTran said its net loss for the October-December period was equivalent to $1 a share. Analysts were expecting a loss of 3 cents a share.
Scheduled Earnings Reports (Thursday)
Ford Motor Co., Sony, 3M Co., 1-800-Flowers, US Airways, Eastman Kodak, Royal Dutch Shell, Occidental Petroleum, Altria Group, Black & Decker, Royal Caribbean Cruises, Colgate Palmolive, Amazon.com, Fortune Brands, Eli Lilly, International Paper, Raytheon
Stocks in the News
Target (TGT) will reduce workforce at its headquarters locations by about 9%.
Yahoo Inc (YHOO) posted a fourth-quarter net loss of $303 million, or 22 cents a share.
E-Trade Financial Corp (ETFC) reported a quarterly net loss as the discount brokerage and banking company set aside more money to cover losses in its loan portfolios.
Stanley Works (SWK) reported its fourth quarter earnings were $1.1 million, or one cent a share, compared with $92.3 million, or $1.11 a share, in the year-earlier period.
Banco Santander (STD) offered a settlement valued at 1.38 billion euros ($1.82 billion) to private clients who lost money with Bernard Madoff through investments in the Optimal Strategic U.S. Equity fund.
Sun Microsystems (JAVA) reported a fiscal second-quarter loss of $209 million, or 28 cents a share.
McCormick & Co. (MKC) reported fourth-quarter earnings of $83 million, or 62 cents a share, compared to $88 million, or 67 cents, in the year-earlier period.
Advantest Corp (ATE) posted a net loss for the recent quarter of 7.8 billion yen ($87.5 million), compared with a 3-billion-yen profit a year earlier.
Praxair (PX) said its fourth-quarter profit dropped 37% to $200 million, or 64 cents a share.
MeadWestvaco (MWV) reported a fourth-quarter loss of $16 million, or 9 cents a
The U.S. House is set to approve today President Obama’s proposed $816 billion economic stimulus package designed to pull the economy out of recession through a combination of tax cuts and $604 billion in spending.
The International Monetary Fund said the global economy is expected grow at the slowest pace since World War II this year. The economy is now expected to grow 0.5% in 2009 and to slowly rebound to 3% in 2010.
The two-day meeting of the Federal Open Market Committee (FOMC) ends today and with interest rates already set at basically zero, the focus is on any other commentary the Fed offers up on what they'll do to help spur the economy. The meeting ends around 2:15 pm (Eastern Time).
The Fed has a number of options to provide relief for distressed homeowners, including lowering the amount the homeowner owes on the mortgage, reducing the interest rate or lengthening the term of the loan. It is unclear how many homeowners would benefit. However, the relief plan would apply to the billions of dollars of mortgage assets the Fed is holding on its books because of last year's bailouts of Bear Stearns and insurer American International Group.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity plunged by 38.8 percent to 732.1 in the week ended Jan. 23rd. Fixed 30-year mortgage rates averaged 5.22 percent in the week, down from 5.24 percent the prior week and 4.89 percent in early January.
The Federal Deposit Insurance Corp. (FDIC) may manage the so-called “bad bank” that the Obama administration is likely to set up as it tries to break the back of the credit crisis. The bad-bank initiative may allow the government to rewrite some of the mortgages that underpin banks’ bad debt, in the hopes of stemming a crisis that has stripped more than 1.3 million Americans of their homes.
Scheduled U.S. Economic Reports (Thursday)
Initial Jobless Claims (Week of January 24th), Durable Goods (Dec), New Home Sales (Dec)
In Earnings News
Boeing Co. (BA) reported a fourth-quarter loss. Boeing reported a loss of $56 million, or 8 cents per share, for the last three months of 2008. Analysts, on average, expected earnings of 78 cents in the fourth quarter.
Wells Fargo & Co. (WFC) had a $2.83 billion loss in the fourth quarter. It reported a net loss of 79 cents per share, after paying preferred dividends. The results included several one-time items, including $5.6 billion, or 99 cents per share, of credit reserve build to cover future loan losses.
New York Times Co. (NYT), battling along with the rest of the newspaper industry to remain solvent during the financial meltdown, said its fourth quarter profit fell 48%. The company said fourth-quarter net income of $27.6 million, or 19 cents a share. On average, analysts expected a profit of 27 cents a share.
General Dynamics Corp. (GD) said its fourth-quarter earnings rose on higher profits in its business jet and shipbuilding units. The company posted net earnings of $612 million, or $1.57 per share. Analysts were expecting $1.59 per share.
AT&T Inc (T) earnings fell 23 percent is the latest quarter. The company earned $2.4 billion, or 41 cents per share, in the last three months of 2008. Analysts expected 42 cents a share.
ConocoPhillips (COP) lost $31.8 billion in the quarter. Net income for the October-December period amounted to a loss of $21.37 per share, compared with a profit of $4.4 billion, or $2.71 per share. Analysts expected earnings of $1.22 a share.
AirTran Holdings Inc. (AAI), parent of discount carrier AirTran Airways, announced its fourth-quarter loss widened to $118.4 million. AirTran said its net loss for the October-December period was equivalent to $1 a share. Analysts were expecting a loss of 3 cents a share.
Scheduled Earnings Reports (Thursday)
Ford Motor Co., Sony, 3M Co., 1-800-Flowers, US Airways, Eastman Kodak, Royal Dutch Shell, Occidental Petroleum, Altria Group, Black & Decker, Royal Caribbean Cruises, Colgate Palmolive, Amazon.com, Fortune Brands, Eli Lilly, International Paper, Raytheon
Stocks in the News
Target (TGT) will reduce workforce at its headquarters locations by about 9%.
Yahoo Inc (YHOO) posted a fourth-quarter net loss of $303 million, or 22 cents a share.
E-Trade Financial Corp (ETFC) reported a quarterly net loss as the discount brokerage and banking company set aside more money to cover losses in its loan portfolios.
Stanley Works (SWK) reported its fourth quarter earnings were $1.1 million, or one cent a share, compared with $92.3 million, or $1.11 a share, in the year-earlier period.
Banco Santander (STD) offered a settlement valued at 1.38 billion euros ($1.82 billion) to private clients who lost money with Bernard Madoff through investments in the Optimal Strategic U.S. Equity fund.
Sun Microsystems (JAVA) reported a fiscal second-quarter loss of $209 million, or 28 cents a share.
McCormick & Co. (MKC) reported fourth-quarter earnings of $83 million, or 62 cents a share, compared to $88 million, or 67 cents, in the year-earlier period.
Advantest Corp (ATE) posted a net loss for the recent quarter of 7.8 billion yen ($87.5 million), compared with a 3-billion-yen profit a year earlier.
Praxair (PX) said its fourth-quarter profit dropped 37% to $200 million, or 64 cents a share.
MeadWestvaco (MWV) reported a fourth-quarter loss of $16 million, or 9 cents a
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