Dow Jones News Top Stories Of The Day – January 18, 2007 January 18, 2007Posted by notapundit in Economic News.
IBM 4Q PROFIT RISES 11%, BEATING EXPECTATIONS
International Business Machines’ profit rises to $3.54 billion, or $2.31 a share, while revenue climbs 7.5% to $26.3 billion. Earnings from continuing operations are $2.26 a share, beating analysts’ forecast of $2.19 a share on $25.7 billion in revenue. CFO says 4Q software revenue growth best in more than five years. Shares drop 4% in late trading.
GE TO PAY ABBOTT $8.13B FOR DIAGNOSTIC OPS
GE unveils deal to acquire diagnostic businesses from Abbott Labs: in-vitro and Point-of-Care. Deal broadens GE’s $17 billion health-care business, moving into health-care information technology and molecular diagnostics in recent years.
CAPITAL ONE 4Q NET UP 39%
Credit-card issuer’s net rises to $390.7 million, or $1.14 a share, as revenue climbs 14% to $3.07 billion, but says “challenging” mortgage industry and interest-rate environment will pressure results in 2007.
US DECEMBER CORE INFLATION UP MILDLY
U.S. consumer prices rise 0.5% in December in line with expectations, but gain is more muted 0.2% when energy and food sectors are excluded. Separately, December housing starts unexpectedly climb, while weekly jobless claims fall by 8,000.
NYMEX CRUDE AT 20-MONTH LOW
Crude oil futures slump to a fresh 20-month low, falling more than 3% and briefly below $50 a barrel after the Energy Department says U.S. stockpiles rose by the most in more than four years.
PLEA DEAL OFFERED IN H-P CASE
State prosecutors offer to drop felony charges against former Chairwoman Patricia Dunn and the four other defendants in Hewlett-Packard’s boardroom spying scandal if they agree to plead guilty to a misdemeanor, defense lawyer says.
ETRADE 4Q EARNINGS JUMP 37%
Online financial services company’s earnings rise to $176.7 million, or 40c a share, up from $129.4 million, or 32c. Net income rises 31% to $628.8 million, driven by a 50.1% jump in operating interest income after loan-loss provisions.
BERNANKE CALLS FOR ENTITLEMENT ACTION
Fed chairman warns Senate Budget Committee the recent narrowing of U.S. budget deficit is simply “the calm before the storm” and that higher entitlement spending could cripple the economy if action isn’t taken soon. See Bernanke testimony at a glance.
PHILADELPHIA FED INDEX TURNS POSITIVE
Philadelphia region’s manufacturing sector bounces back into positive territory in January from the prior month. Federal Reserve Bank of Philadelphia’s business conditions index rises to 8.3. Economists expected a 2.0 reading.
MERRILL LYNCH NET UP 68%, HIKES DIVIDEND
Firm’s 4Q net income climbs to $2.35 billion, or $2.41 a share, on the back of strong trading and investment banking fees. Results top Wall Street expectations of $1.92. Merrill raises quarterly dividend 40% to 35c a share. Stock falls 1%.
APPLE FALLS ON FLAT MAC SALES
Shares drop 4% a day after the computer and consumer electronics company reports Macintosh shipments were flat on quarter and below some expectations. It also is targeting 2Q revenue and earnings that are below expectations.
TYCO FILES TO REGISTER SECURITIES FOR SEPARATION
Tyco International files with SEC to register equity securities for Tyco Electronics and Tyco Healthcare, and debt offerings for all three entities. Its upcoming separation is expected early in 2Q into three independent, publicly traded companies.
FANNIE HAD 3Q LOSS ON GAAP BASIS
James Lockhart, director of the Office of Federal Housing Enterprise Oversight, says Fannie Mae had a 3Q loss as he expressed concerns about how long it is taking for Fannie and Freddie to recover from accounting scandals.
SHAREHOLDER SEEKS SEC INQUIRY INTO BEAR STEARNS
Shareholder activist asks SEC to open an enforcement investigation of Bear Stearns for not promptly notifying him of its efforts to block a proposal he wants to put to a shareholder vote.
DAIMLER BOARD TO DISCUSS CHRYSLER PLAN
DaimlerChrysler plans to present a restructuring plan for its troubled Chrysler Group division at an extraordinary supervisory board meeting in February, people familiar with the situation say.
ALGER SETTLES MARKET-TIMING CHARGE
Fred Alger Management and Fred Alger & Co. will pay $40 million to settle charges of allowing market timing and late trading in Alger Fund, and agree to reduce fund management fees by $5 million over five years, regulators announce.
AON TO CUT 550 JOBS
Insurance broker says it intends to eliminate jobs as part of a consolidation of its service support activities for its U.S. retail brokerage operation as it shuts down two offices and expands a third.
CONTINENTAL AIRLINES 4Q LOSS NARROWS
Carrier posts net loss of $26 million, or 29c a share, thanks to continued strong revenue growth, as results are impacted by $22 million pension charge. Revenue rises 11% to $3.16 billion, matching Wall Street estimates. Shares gain 2%.
TIME INC TO LAY OFF 289 EMPLOYEES
Time Warner’s magazine unit announces fresh round of layoffs affecting 289 people, or 2.5% of the work force. Departures include some who take buyout packages.
======= DOW JONES NEWSWIRES ANALYSIS AND COMMENTARIES =======
Fall, With Chip Equipment Sector Down
Small stocks fall for third straight day, with tech groups coming under some heavy selling pressure. Chip equipment stocks tumble as investors react negatively to guidance from large cap Lam Research.
IRS Scrutinizes Donor-Advised Funds
IRS is putting donor-advised funds, surging since 1990s, but defined only last year in tax code, under a microscope, prompted by worries they may be used as tax-free slush funds for donors, for such expenses as tickets and tuition.
============ U.S. MARKETS ACTION ===========
DJIA down 9.22 points to 12567.93
NASDAQ down 36.21 points to 2443.21
S&P 500 down 4.25 points to 1426.37
10-year T-note up 9/32 at 99 1/32 yield 4.747
NYMEX Spot Crude down $1.32 at $51.81/bbl
Dollar/Euro down 0.0001 at 1.2936