President Obama is ready to offer a detailed sketch of the first year of his presidency, casting the nation's bleeding economy as a tangle of tough, neglected problems. In a prime-time speech from the House of Representatives, Obama will make his case this evening that much more has to be done to turn around the economy — a message he knows he must explain. The speech comes two days before he delivers a budget blueprint to Congress.
Fed Chairman Bernanke said that restoring financial stability is the top job facing policy makers. He told members of the Senate Banking Committee that if actions taken by the Obama administration and the Fed are successful in restoring some measure of bank stability, "there is a reasonable prospect that the current recession will end in 2009 and that 2010 will be a year of recovery."
Meantime, the Federal Reserve is urging dozens of banks getting bailout funds to put the money into new loans or bolster loss reserves, not to pay dividends for shareholders.
The February consumer confidence index fell to 25 from a downwardly revised 37.4 in January. Economists had expected a February reading of 35. Today’s confidence report showed the share of consumers who said jobs are plentiful slumped to 4.4 percent from 7.1 percent last month.
The Standard & Poor's/Case-Shiller U.S. National Home Price Index plunged 18.2 percent during the quarter from the same period a year ago, the largest drop in its 21-year history. Prices are now at levels not seen since the third quarter of 2003. In the month of December, the Case-Shiller 20-city index plunged 18.5 percent from December 2007 levels, while the 10-city index dropped 19.2 percent.
American International Group (AIG), rescued twice last year by the U.S. government, is asking for more aid and bracing for a fourth-quarter loss of roughly $60 billion. It would be the biggest loss in a quarter in corporate history.
John Thain, the former Merrill Lynch & Co. chief executive officer, will disclose to New York state lawyers the names of employees who got $3.6 billion in bonuses just before the firm merged with Bank of America Corp. (BAC).
Scheduled U.S. Economic Reports (Wednesday)
Existing Home Sales (Jan)
In Earnings News
Office Depot (ODP) says it lost $1.54 billion in the fourth quarter. Office Depot reported a loss of $5.64 per share, after a profit of $18.77 billion, or 7 cents per share, a year ago.
Macy's Inc. (M) reported an almost 59 percent drop in fourth-quarter earnings. The retailer earned $310 million, or 73 cents per share. That compares with $750 million, or $1.73 per share, a year earlier.
The Home Depot (HD) lost 3 cents per share during the quarter. That compares with a profit of $671 million, or 40 cents per share, a year ago. Home Depot has said it plans to eliminate 7,000 jobs, or about 2 percent of its 300,000 workers.
Target Corp. (TGT) says its fourth-quarter profit fell 41 percent. The discount retailer earned $609 million, or 81 cents per share. Analysts expected Target to earn 83 cents per share.
H.J. Heinz Co. (HNZ) said its third-quarter profit rose 11 percent as it raised prices. Heinz said it earned $242.3 million or 76 cents per share while analysts were expecting 64 cents.
Tenet Healthcare (THC) says it lost 7 cents per share on $2.2 billion in revenue. That compares with a loss of $75 million, or 16 cents per share, on $2.1 billion in revenue for the same quarter in 2007.
Cracker Barrel Old Country Store Inc. (CBRL) said its fiscal second-quarter profit dropped 9 percent on lower sales. Net income declined to $18.4 million, or 81 cents per share, compared with $20.2 million, or 85 cents per share, a year earlier.
RadioShack Corp. (RSH) said its fourth-quarter profit dropped 39 percent as consumers pulled back on their discretionary spending. Net income slid to $62 million or 50 cents per share while analysts expected 70 cents.
Scheduled Earnings Reports (Wednesday)
Avis-Budget Group, Express Scripts, Hearst-Argyle Television, Zale, Washington Post, Martha Stewart Living Omnimedia, Isis Pharmaceuticals, Del Monte Foods, Publix, Saks, J.M. Smucker
Stocks in the News
HealthSouth Inc (HLS) fourth-quarter net income of $1.81 a share from a year-earlier net loss of 67 cents a share as revenue rose 67% to $463.8 million.
DTE Energy Co. (DTE) fourth-quarter profit fell to $129 million or 80 cents a share, from $255 million, or $1.56 a share, in the year-ago period.
AstraZeneca (AZN) said that an initial Phase III clinical trial of its product to treat children with asthma did not meet co-primary endpoints.
General Motors Corp (GM) is planning temporary work stoppages for several days at its three Mexico plants in March and April due to falling global demand.
Medco Health Solutions (MHS) reported fourth-quarter net income of $274.4 million, or 54 cents a share.
Nordstrom (JWN) reported its fourth-quarter net income fell to $68 million or 31 cents a share, from $212 million, or 92 cents a share, in the year-earlier period.
JP Morgan Chase (JPM) said its board cut the company's quarterly dividend to 5 cents from 38 cents, effective for the dividend payable April 30th.
Onyx Pharmaceuticals Inc (ONXX) reported that its fourth-quarter net loss widened to 53 cents a share from 21 cents in the year-earlier quarter.
Micron Technology (MU) said it plans to cut 500 employees in the short term and may eliminate as many as 2,000 positions by the end of the fiscal year.