Market Update – Citigroup (NYSE:C), General Electric (NYSE:GE), Bank of America (NYSE:BAC), Apple (NASDAQ:AAPL), JP Morgan Chase (NYSE:JPM)
To start our market update, there’s some good news on the unemployment front in America. First time jobless claims in the United States dropped by 14,000 last week, to 442,000 total. The number is above what economists had predicted for the market, as they were expecting the initial unemployment claims number to be closer to 450,000. According to MSN Money, the four-week moving average of initial claims is now at 453,750, a decrease of 11,000. Continuing claims also fell last week, down 54,000 to 4.65 million, which is the lowest level since December of ’08.
The Fed’s chairman, Ben Bernake, went on record today to say that the United States record-low interest rate needs to remain at it’s current level in order to encourage continued growth. He also mentioned that, once the economy is strong enough, the Fed is ready to begin tightening credit and interest out of fear of inflation once the economy is deemed stable.
EU leaders are planning a meeting in Brussels today to discuss the growing Greece debt situation. Investors eyes will be glued to the resulting announcements, as this meeting may likely determine whether the EU will bail out the indebted Balkan state, or recommend Greece seek assistance from the IMF (International Monetary Fund). Also, the EU today may outline the specific plan for how they’d like to go about helping the struggling nation, should they go that route. Last year, Greece had a deficit of 12.7% of it’s Gross Domestic Product, more than triple the European Union’s limit of 3%.
The US Treasury is reportedly planning to sell its holding of Citigroup (NYSE:C). The plan that’s currently being circulated is that the Treasury has set a schedule to offload the 27% ownership it currently holds. The bailed out bank had received $45 billion in taxpayer money during the peak of the financial crisis, and it appears the Treasury is now trying to get as high a return on the taxpayer investment as possible. The plan may be announced as soon as next month.
General Electric (NYSE:GE) has announced that they plan on investing over 340 million Euros into developing better technology for wind turbine manufacturing and better facilities. The upgrade will result in a reported 75 million Euro investment in the company’s Oslo facilities, as well as expansion in the United Kingdom, Germany, and Swedish operations. Yesterday GE saw its shares go up on an increase in its rating from Bernstein, which now has the megacorp at an “outperform” rating.
It’s being reported that Bank of America (NYSE:BAC) is planning to forgive some of its debt within the state of Massachusetts. Massachusetts residents may be pleased (and B.of.A investors disheartened) to hear that the banking giant has promised to forgive up to 30% of principal to mortgage payers who owe over 120% on their homes current value, after pressure by the Commonwealths attorney general. This PR move is part of a loan modification program within the state, costing approximately $3 billion to the company.
Apple (NASDAQ:APPL) shares have hit a record high today. Forecast numbers for sales in the tech companies traditional strength, Macs, have been up recently. Combine that with the growing buzz on forecast numbers for the recently announced iPad, and investors are flocking to the company of cool. BMO Capital Markets has listed the stock as “Outperform”, causing a further boost to the price level.
JP Morgan Chase (NYSE:JPM) has just released a two-page report on unemployment, stating that unemployment numbers are being inflated by increased government assistance. Their economists calculated that the governments 99 week program has increased unemployment by 1.5 percent, and some of the unemployed who have been out of work for over six months (According to Reuters, this is 40 percent of the unemployment numbers) should no longer be listed as ‘unemployed’, as they’ve stopped actively looking for work.
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