Investors weighed reports Friday showing sharp declines in industrial production and consumer-level inflation, and news from Citi and BofA
U.S. stocks slipped into the red Friday afternoon, as investors cash in on gains fueled by big banks’ plans to shore up their money matters. The U.S. form of sovereignty has agreed to inject $20 billion into Bank of America (BAC) and assurance losses upon the body over $400 billion in assets of both BofA and Citigroup (C). The federal aid comes as BofA and Citi one and the other instructed fourth-quarter losses, and Citigroup said it would separate its traditional banking business from its riskier assets. Shares of both companies were lower Friday.
Investors also weighed a report showing that the U.S. consumer price index fell 0.7% in December, while the inner part CPI, which excludes food and energy prices, was flat. Meanwhile, U.S. industrial production plunged 2.0% in December, and the University of Michigan’s consumer maxim index rose in January.
Bonds were lower, through the yield on the 10-year note rising to 2.31%. The dollar index was too lower, at 84.14. Gold futures were higher at $834.60 by means of ounce. Crude oil futures were lower at $34.89 per barrel.
On Friday at 12:10 p.m. ET, the 30-stock Dow Jones industrial average was lower by 19.20 points at 8,193.29. The broader S&P 500 index fell 4.13 points to 839.61. The tech-heavy Nasdaq compounded index shed 6.52 points to 1,505.32.
On the New York Stock Exchange, 15 stocks were lower in price for every 14 that were higher. Nasdaq generosity was 14-11 negative.
Bank of America said Friday that in view of severe terms in the markets and the economy, the U.S. government agreed to assist in the firm’s acquisition of Merrill Lynch by making a more distant investment in BofA of $20 billion in preferred accumulate. The company said the government has also agreed to provide protection against more distant losses on $118 billion in selected capital markets exposure, primarily from prior the Merrill Lynch portfolio. The company also cut its quarterly profits divided to 1 cent. BofA well-informed a 48-cent fourth-quarter loss, vs. 5 cents EPS some year earlier, as a significant increase in providing for enter upon the credit side losses and other expenses offset a 19% revenue go.
Citigroup announced Friday that it will realign into two businesses, Citicorp and Citi Holdings, to optimize its global businesses for future beneficial growth and opportunities. The company posted a fourth-quarter disadvantage of $1.72 per share, vs. a $1.99 defeat one year earlier (both from continuing operations) contemptuous opposition a 13% revenue decline. Citigroup said results included $6.1 billion in net credit losses, a $6.0 billion pure loan destruction reserve build; revenues of $5.6 billion were pretending by write-downs and losses in Securities and Banking.
Intel Corp. (INTC) posted fourth-quarter EPS of 4 cents, vs. 38 cents one year earlier, on a 23% receipts decline and a narrowed gross margin. Results include $1 billion negative contact from Intel’s previously announced reduction in carrying value of its Clearwire investments. EPS was in family with the Wall Street consensus view. For internal purposes, Intel says it is currently planning for first-quarter revenue in the vicinity of $7 billion. Gross margin percentage is expected to languish to the low 40s, primarily due to higher underutilization charges and 32nm start-up costs.
Original text: http://www.businessweek.com/investor/content/jan2009/pi20090116_554420.htm?campaign_id=rss_null
