Financial News 4/8/12 – 4/14/12

Economy

-Revolving consumer credit, which mostly is represented by credit cards, fell in February for the second straight month as consumers try to reduce expenses.  4/9

-The number of unemployed people per job opening declined to 3.66 in February for the lowest level since 2008.  4/11

-Industrial output in the Eurozone fell 1.8% in February compared to a year earlier, its largest drop in 2 years.  4/12

-Unemployment insurance claims rose substantially last week up 13,000 to 380,000.  The previous week’s report was also revised upwards.  4/13

-China’s first quarter GDP of 8.1% disappointed as it was lower than estimates, and its lowest level since the first quarter of 2009.  4/13

Regulatory

-The Justice Dept. is bringing a civil suit against Apple, and five of the country’s largest publishers alleging they colluded to raise e-book prices.  4/12

Corproate 

-Sony announced it would cut 10,000 jobs in an effort to restructure.  4/10

-AOL will sell and license a collection of its patents for $1.1 billion to Microsoft.  4/10

-Facebook announced it will buy Instagram, a photo sharing application, for $ 1billion.  It’s the largest deal Facebook has made to date.  Instagram was founded in October 2010 and has ten employees. 4/10

-Best Buy’s CEO resigned over concerns he had an inappropriate relationship with an employee adding to the problems of the electronics store.  4/11

-Alcoa kicked off earnings season announcing a decline in profit of 69% on lower aluminum prices, but their numbers beat analysts’ forecasts of a loss.  4/11

-Johnson and Johnson was ordered to pay $1.2 billion as a penalty after a jury found that the firm violated consumer protection laws while marketing a drug.   4/12

-Nokia issued a profit warning as competitors took market share in emerging markets and a technology glitch has hurt its cause as it attempts to gain a foothold in the USD smart phone market.  4/12

-Banesto, the first major Spanish bank to release earnings, posted a 88% drop in earnings on the need to raise reserves in order to comply with new snappish banking rules.  4/13

-Google announced a first quarter profit of 61%.  In addition, it said it would complete a 2-for-1 stock split, but founders Serge Brin and Larry page would maintain their controlling voting rights.  4/13

-J.P. Morgan and Wells Fargo released earnings that beat analyst estimates however it was primarily driven by the firms reserving fewer funds for future losses.  4/14

Market

-The market continued its fall on the first trading day since the announcement of the weak jobs report.  The Dow fell 1%, the S&P dropped 1.1% and Japan dropped 1.5%. The 10 year Treasury yield declined back to 2.035%, a level last seen in early March.  4/10

-Concerns about Europe, and specifically Spain, continued to weigh on world markets a long with recent signs of weakness in the US economy.  The S&P fell 1.7%. The Dow sank 1.7%, its largest drop of the year.  Italian stocks dropped 5% and Spanish stocks fell to their lowest level since March 2009.  Overall Europe fell 2.5%.  Investors fled stocks for the safety of fixed income as the 10 year treasury dropped sharply below to 2% level to 1.988%, the lowest it had been since early March.  4/11

-Stock markets bounced back after the previous day’s losses on strong corporate earnings news and easing in European sovereign borrowing rates. The S&P 500, Dow, and Europe all gained 0.7%. 4/12

-Oil supply increases from Saudi Arabia are reducing the expected impact of sanctions against Iran on oil prices.  4/13

-World markets continued to rebound with the Dow up 1.4%, the S&P up 1.4%, and Europe gaining 1.2%.  4/13

-Spanish banks increased their borrowing from the ECB in March, showing that investors have left the country’s banks to rely on ECB funding.  4/14

-Stocks had their worst week of the year on concerns over Spanish debt, and slowing growth in China. The Dow fell 1.1% for the day and 1.6% for the week, while the S&P 500 dropped 1.3% for the day and 2% for the week.  Europe fell 2.2% for the week.  The 10 year Treasury yield remains under 2% at 1.996%.  4/14

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