Immigrant Son

IMMIGRANT SON – Breaking News, Provocative Stories, Global Economic Analysis

Poll of Change: Obama’s Approval Slips Below 50%

POLL: Under our long-standing measure of job performance (excellent, good, fair, poor), Obama’s positive ratings have dipped just below 50%. Likely voters choosing excellent or good fell three points from another Zogby Interactive poll concluded on March 5, going from 52% to 49% excellent or good; while 11% said fair and 38% poor…

Advertisements

Filed under: Obama, , , , , , , , , , , , , , , , , , ,

Obama Admin. Set to Propose Largest Expansion of Government Tomorrow

REGULATE

PAPER: The Obama administration’s plan, described by several sources, would extend federal regulation for the first time to all trading in financial derivatives and to companies including large hedge funds and major insurers such as American International Group. The administration also will seek to impose uniform standards on all large financial firms, including banks, an unprecedented step that would place significant limits on the scope and risk of their activities…

Filed under: Economics, Politics, , , , , , , , , , , , , , , , , , , , ,

Obama to Meet With Heads of Goldman Sachs, JPMorgan, Citi and Other Bank Leaders

PAPER: President Barack Obama will meet with about a dozen U.S. bank leaders on Friday to talk about his administration’s plans to put the sector on a sounder footing, The Wall Street Journal reported late Tuesday on its Web site. Invitees include Goldman Sachs Group Inc. , J.P. Morgan Chase & Co. and Citigroup Inc. The meeting follows more than a week of controversy over large bonuses paid at American International Group Inc. , after the insurer received billions in federal aid…

Filed under: Economics, Obama, , , , , , , , , , , , , , , ,

Stock Bargains Everywhere as ‘Bull-Market’ Begins, Says Analyst

WIRE: The next “bull-market” rally has begun and there are bargains in every emerging market, Templeton Asset Management Ltd.’s Mark Mobius said, refuting predictions that the equities meltdown will continue.

“You have to be careful not to miss the opportunity,” said Mobius, who helps oversee about $20 billion of emerging- market assets at San Mateo, California-based Templeton. “With all the negative news, there is a tendency to hold back…”

Filed under: Economics, Stocks, , , , , , , , , , , , , , , , ,

Stocks Rally After GE Chief Says They Can Withstand Loan Defaults

US Session Key Developments

  • General Electric Can Withstand Loan Defaults
  • Housing Data Surprises to the Upside
  • Alcoa Slashes Dividend 82% to 3 Cents Per Share

Stocks Rally After GE Chief Says They Can Withstand Loan Defaults

Wall Street celebrated St. Patrick today by finishing the trading session deep in the green after General Electric’s Chief Executive Officer Jeffrey Immelt stated that the company had sufficient reserves to withstand loan defaults. The comments come as a relief after the conglomerate slashed its dividend three weeks ago for the first time since the Great Depression. Surprising Housing and Producer Price data surprised to the upside, leaving traders in an upbeat mood. The prices that manufacturers pay for raw materials rose 0.2% when excluding food and energy with economists expecting the figure to rise by only 0.1%. With these costs now higher, taxable income deteriorates, which in turn allows companies to be more profitable. Sentiment continued its upward trend after housing starts unexpectedly rose 22% in February. As such, KB Home, the fourth-largest U.S. homebuilder advanced 9.3% along with Home Depot, which rose 6.7%. The blue chips could have performed a bit stronger had it not been for an 82% dividend slash from Alcoa, the largest U.S. aluminum maker and a member of the Dow 30, which brought its quarterly cash payout to only 3 cents per share. Nonetheless broader optimism led Financials to perform the strongest. JPMorgan, Wells Fargo, and Citigroup all moved ahead by more than 7.0%.


Dow 30            7395.70         +178.73           +2.48%

The Dow fell in the minutes after opening bell only to rally from thereon. It closed near the day’s high with only one sector finishing the day down, Materials. The sector’s performance is not of particular surprise considering Alcoa’s stock tanked 8.66% after it slashed its dividend by 82% to 3 cents per share.

NASDAQ         1462.11           +58.09              +4.14%
NASDAQ stocks performed the strongest with Information Technology rallying 4.25%. Apple rallied 4.44% after it had let developers preview a beta of the iPhone OS 3.0, which includes cut and paste features and automatic updates.

S&P 500          778.12            +24.23              +3.21%

S&P 500 stocks saw every sector in the index rally by at least 1.74% with Financials surging 6.58%. General Electric was one of the most active stocks, trading 22.74 million shares after its CEO announced that it had adequate capital reserves to withstand loan defaults. The VIX fear gauge couldn’t find enough momentum to fall below the 40 mark; nonetheless it dropped 6.7% to 40.80. Overall, 476 stocks rose with only 24 finishing the day down.

Filed under: Stocks, , , , , , , , , , , , , , , , , , ,

Stocks Have Biggest 3-Day Gain Since Nov. On Bank of America Profit Outlook

US Session Key Developments

  • Bank of America’s Chief Says Company Profitable First Two Months
  • Retail Sales Better Than Expected
  • General Electric Rating Cut to AA+

Stocks Have Biggest 3-Day Gain Since Nov. On Bank of America Profit Outlook

Stocks in the S&P 500 posted the largest 3-day gain since November with a 10.96% surge since Tuesday after Bank Of America Chief Executive Officer Ken Lewis followed the footsteps of his counterparts at Citigroup and JPMorgan. Indeed, Lewis announced that his bank was profitable in the first two months of the year to reporters after a speech given in Boston. The recent trend of CEO profit announcements has allowed Financials in the S&P to rise 33% on the week. General Electric added 13% after losing its AAA credit rating by less than expected. The conglomerate slashed its dividend for the first time since the 1930s two weeks ago in an effort to save the company billions of dollars so that it could prevent its own credit deterioration. Wal-Market advanced 3.1% after government Retail Sales estimated that purchases from such stores had done better than economists had anticipated. The figure for February fell -0.1% while forecasts called for a -0.5% decline.

Dow 30                     7170.06                 +239.66                    +3.46%
Financials pummeled through the remaining short-sellers, surging ahead 13.07%. Even the worst performing sector in the index, Technology, moved up 2.0%. JPMorgan saw 31.73 million shares traded to end the day up $2.80 or 13.73% at $22.30.

NASDAQ                  1426.10                  +54.46                        +3.97%
Technology stocks have become a smaller portion of index after being one of the worst performing sectors in composite. Nonetheless, the industry rallied 2.85% with Apple and Intel jumping about 4.0%.

S&P 500                  750.74                    +29.38                        +4.07%

The S&P 500 had its biggest 3-day again since November, rallying 10.96% since the surge began. Every sector in the index shared the sentiment with Financials rushing ahead 9.94%. Implied volatility on the index dropped 5.57% or 2.43 points to 41.18, leaving the fear gauge under 50 for the fifth straight trading session.

Filed under: Economics, Stocks, , , , , , , , , , , , , ,

Stocks Trade in Tightest Range Since Early February on JPMorgan Profit Outlook

US Session Key Developments

  • JPMorgan’s CEO Echoes Citi, Announces Profits
  • S&P 500 Trades in Tightest Range Since Feb. 2nd
  • Volatility Remains Under 50 For Fourth Day

Stocks Trade in Tightest Range Since Early February on JPMorgan Profit Outlook

Stocks in the S&P 500 traded in the tightest daily range since Feb. 2nd, but nonetheless finishing the day just inches above ground. The marginal gain extended yesterday’s 6.40% surge in the 500 stock index as speculation that Citigroup would be announcing much better than expected profits for the first quarter. Interestingly enough, JPMorgan Chief Executive Office Jamie Dimon echoed comments by his Citigroup counterpart, saying that his company would be profitable in January and February. Indeed, Citigroup continued to jump, by 6.21% to $1.54. JPMorgan extended gains by 4.62% to $20.40. But the broad market didn’t react as enthusiastically as they had just yesterday. This may be due to the fact that Moody’s Investor Service stated that the bank, which bought Bear Stearns last March and Washington Mutual in October, would see its credit rating outlook slashed to ‘negative’ last week.

Dow 30              6930.40                  +3.91                    +0.06%

Sector performance was mixed in the Dow with four slipping and five finishing the day ahead. The best performing one was the Financials, which rose 2.35%, while the worst one, Energy, slipped 1.69% after crude had its worst day since Mar. 2nd.

NASDAQ           1371.64                    +13.36                  +0.98%

The NASDAQ was the best performing index of the three major U.S. benchmarks, rising as much as 1.89% before profit-taking forced it down. Apple jumped ahead by 4.51% after it introduced a newer, smaller, talking iPod Shuffle that will sell for $79 Ebay also performed strongly, advancing 4.77% to $11.63 after the Silicon Valley-based company announced plans to expand the global presence of its PayPal online payment system.

S&P 500            721.36                      +1.76                     +0.24%

The S&P 500 traded in its tightest daily range since February 2nd after having its greatest day since early November. Financials were the best performing sector, advancing 2.40% as Citi and JPMorgan continued to surge more than 4.60%. The VIX volatility index dipped slightly, by 0.90% to 42.61 and marked the fourth consecutive session that the fear gauge remains under 50.

Filed under: Economics, Stocks, , , , , , , , , , , , , , , ,

Stocks Surge Most Since late November, S&P Ahead 6.1% on Citi Optimism, ‘Uptick Rule’

US Session Key Developments

  • Citigroup to Have Best Performance Since 2007, Says Pandit
  • Sen. Barney Frank to Reinstate ‘Uptick Rule’
  • Financial Shares Surge 15.58%
  • Dow and S&P Stocks Best Performance Since November


Stocks Surge Most Since Late Nov., S&P Ahead 6.1% on Citi Optimisim

U.S. stocks surged by the most since late November after an internal memo from Citigroup’s Chief Executive Officer Vikram Pandit stated that his bank would be having the best quarter since 2007. The memo stated that the company realized a substantial gain in profits in the first two months of the quarter/year. Indeed, Financials bulldozed through any pessimism to finish the day up 15.58%. Citigroup shares showed the strongest performance, racing ahead by 38.10% to finish the day at $1.45. JPMorgan and Bank of America basked in the glory, rising 22.64% and 27.73%. General Electric also rose 20.0% on improved credit outlook. Surprisingly, comments by Senator Barney Frank of Massachusetts helped sustain the rally. During questioning of Federal Reserve Chairman Ben Bernanke, he stated that the “uptick rule” would be reinstated after having been removed in July 2007. The uptick rule requires that a stock rise in price before it can be sold short. Reinstating this rule would make the practice of borrowing and selling a stock, (short-selling) in order to profit from the fall in share prices, less accessible.

Dow 30                        6926.49               +379.44                  +5.80%
The Dow had its best day since Nov. 21st with financial shares jumping 20.96% ahead. Even the worst performing sector, Consumer Staples, rallied by 2.06%. All 30 stocks in the index finished the day in the green, with Citigroup, Bank of America, and JPMorgan performing the best.

NASDAQ                     1358.28                +89.64                     +7.07%
The NASDAQ performed the best of the three major U.S. equity indices. Information Technology also surged despite being hardest hit throughout yesterday’s trading session. Intel and Microsoft rose 10.92% and 9.70%, respectively.

S&P 500                     719.60                    +43.07                        +6.37%
The S&P 500 had its best day since November 21st. It surged ahead with only 13 stocks finishing the day in the red; only five of those lost more than 1.0%. The VIX volatility index plummeted, by 5.31 points or 10.70% to finish the day at 44.27. Short interest on the S&P

Filed under: Economics, Stocks, , , , , , , , , , , , , , ,

Merrill Lynch Racks Up $400 Million FOREX Loss, Trader Investigated

“A Merrill Lynch currency trader has been suspended after racking up more than $400m in undisclosed losses in recent months, raising further questions about the financial health of the investment bank bought by Bank of America last September.

Merrill is poring over the books of Alexis Stenfors, a London currency trader, who was suspended after Norwegian and Swedish currency trades went wrong, according to people familiar with the situation. Merrill is in talks with UK regulators after uncovering what it called a trading “irregularity” in London.”

Filed under: Economics, , , , , , , , , , , , , ,

MARKETS RUN RED WITH FEAR, CITI BECOMES A PENNY STOCK

MARKETS BLEED, BANKING SHARES COLLAPSE

sharescollapse

CITI WORTH LESS THAN A DOLLAR…

ONCE THE WORLD’S MOST VALUABLE STOCK…

FDIC COULD BECOME INSOLVENT THIS YEAR…

MORE THAN 11% OF MORTGAGES ARE TROUBLED…

JPMORGAN RATING OUTLOOK TURNED NEGATIVE…

OBAMA MORTGAGE PLAN TO BLAME…?

Filed under: Economics, Obama, , , , , , , , , , , , , , , , ,

Stocks Give Back Yesterday’s Gains as Troubled Mortgages Rise to Nearly 12%

US Session Key Developments

  • JPMorgan Credit Outlook Slashed By Moody’s
  • Troubled Mortgages Jump to Nearly 12%
  • FDIC Chief Says Funds May Dry Up
  • Citibank Shares Trade Under $1

Stocks Give Back Yesterday’s Gains As Troubled Mortgages Rise to Nearly 12%

Stocks were pummeled today with Financials continuing their slide after President Obama’s mortgage bailout plan was revealed to benefit only those whose home loans were owned by Fannie Mae or Freddie Mac. Banks like Wells Fargo, which owns 16% of the mortgage market, will likely not directly benefit as a result. As such, any confidence that Obama’s plan would help stabilize the banks went down the drain. If that wasn’t enough to bring down the financial sector, JPMorgan’s credit outlook was slashed by Moody’s yesterday in after-hours trading. Indeed, the bank which was first hailed as a beacon of financial stability may now be in danger. The credit rating agency stated that JPMorgan’s health was at risk due to its direct exposure to bad loans and credit defaults.

Housing data continued to plague the industry. Data showed that Mortgage Delinquencies jumped 7.88% in the final quarter of 2008. Overall, nearly 12% of all mortgages are either late, delinquent, or are in foreclosure.

Sheila Blair, the Chairman of the Federal Deposit Insurance Corp. (FDIC) said that the pool of money that it holds to insure consumer banking accounts for up to $100,000 could dry up by the end of the year. In response to a swarm of letter that the corp. received as a result of FDIC fee increases she stated “without these assessments, the deposit insurance fund could become insolvent this year.” All this inertia led Citigroup, which was once the largest bank by market capitalization, to trade under $1 per share for about 40 minutes today. Shares of the embattled bank reached a low of 97 cents. Citigroup ended the day down -9.73% at $1.02 per share with JPMorgan finishing down -13.99% at $16.60.

Dow 30                   6594.44                      -281.40                      -4.09%
Every sector in the Dow Jones Industrial Average took a beating with Financials seeing the worst of the storm. The sector dove -12.90% with Materials tanking -9.08% with it.

NASDAQ               1299.59                       -54.15                          -4.00%
NASDAQ sector performance was more evenly distributed with Financials dipping -6.68% and Information Technology falling -3.58%. Microsoft and Cisco were the most actively traded stocks, declining -5.27% and -4.59%, respectively.

S&P 500                682.55                         -30.32                        -4.25%
The S&P plummeted as much as 4.9% on the day before profit-taking forced the index to close the day down -4.25%. The most active stock was JPMorgan which saw 33.61 million stocks traded as it fell -13.99%. The VIX volatility index jumped to 50.17 or by 5.49%.

Filed under: Economics, Obama, Stocks, , , , , , , , , , , , , , , , , , , , ,

JPMorgan’s Rating Outlook Slashed by Moody’s

JPMorgan Chase & Co., a commercial and investment bank that was once thought to be one of the most stable, had its rating outlook cut to negative by Moody’s Investor Service after trading ended today. Indeed, the bank which purchased Bear Stearns after it had essentially failed last March and who purchased Washington Mutual after the FDIC had placed it into receivership was once seen as a beacon of banking stability. Now, with the expectation that the financial institution will be hit with bad loans and credit defaults, the lender’s status is in danger.

The news of this release may spark volatility in equity markets throughout European and U.S. trading. As such, those pairs which have been estimated to be vehicles for risk aversion, the U.S. Dollar against the Euro for example, may see their respective price action push full steam ahead.

– LG

Filed under: Economics, , , , , , , , , , , , , , ,