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So Far, So…Mediocre
Weak.
Remember last week when I said I expected the market to come off a little bit from the recent buying spree, and that it was healthy for the market to behave in such a way? Well, it did, and it was. I expected the market to (hopefully) bounce up again afterwards. It did.
But until Thursday, it has done so with about as much conviction as a handshake from a crying three-year-old.
The market’s behavior in the past month or so has closely resembled that of the “bouncing ball” experiment that most of us did in science class. Each time the…
6Feb2009 | Oxbury Research | 0 comments | ContinuedGlobal Investing Roundups
Emerging Market Funds Lose $48 Billion; Bank of America Sells China Bank Shares; Family Dollar Beats and Raises Forecasts; New CEO, Cost-Cutting at Orbitz; Russian Winter; Monsanto Reaps Profit; No Pain Means Gain for Sun; Oil Slides 12%
- More than $48 billion was withdrawn from emerging market funds in 2008, with the largest chucks of change pulled from funds tracking Asia, according to EPFR Global. An emerging markets bellwether, the MSCI Emerging Markets Index, dropped 54% last year, its worst performance since it was created in 1987, Bloomberg reported.
- Bank of America Corp. (BAC) sold 5.62 billion of its China Construction Bank…
Global Investing Roundups
South Africa Cuts Interest Rates; BlackRock Cans 500; Empire Co. Posts 13% Profit; KB Toys Files for Bankruptcy; Citi and UBS to Buy Back $30 Billion in Securities; Bank of America to Cut 35,000 Jobs
- South Africa’s central bank cut a half-percentage point from its benchmark interest rate, marking the country’s first interest rate reduction in more than three years, Bloomberg reported. The growing global crisis, rising unemployment and falling commodity prices are hampering growth for the emerging economy.
- Asset manager BlackRock Inc. (BLK) cut 500 jobs, Chief Executive Laurence Fink said Thursday. Many of the job losses were part-time employees, Reuters reported. BlackRock…
Bank of America Shares Plunge on Earnings Shortfall, Major Dividend Cut
Shares of Bank of American Corp. (BAC) fell more than 26% during trading yesterday (Tuesday) as investors reacted to the company’s disclosure that it was cutting its dividend after its third-quarter earnings plunged a stunning 68%.
The Charlotte-based BofA also said it will cut its dividend in half – to 32 cents a share – and will sell as much as $10 billion in common stock to beef up its balance sheet.
The dividend cut underscores the crisis-like capital situation in the U.S. banking sector, especially since Bank of America executives had repeatedly told Wall Street that the bank would not cut…
8Oct2008 | Money Morning | Comments Off | ContinuedGlobal Investing Roundups
S&P Slashes RBS Rating; Dendreon’s Big Boost; Eli Lilly Comes Out Ahead on ImClone; AgFeed’s Hungry For Its Own Shares; Bank of America Surprises with Loss; Paulson Taps Another Goldman Exec.
- Standard & Poor’s yesterday (Monday) reduced the credit rating of Royal Bank of Scotland PLC (ADR: RBS), lowering the rating of both the Edinburgh-based bank’s long-term and short-term debt. “The rating actions reflect Standard & Poor’s expectation that RBS’s financial profile may continue to weaken,” the analysts said, citing a “combination of mixed earnings prospects, deteriorating credit risk in its key geographies, and difficult market conditions” in which to shore up its…
After Reloading With Wachovia’s Banking Business, Citigroup Takes a New Aim at the U.S. Banking Market
Citigroup Inc. (C) will acquire Wachovia Corp.’s (WB) banking operations for $2.l6 billion, a deal that will restore Citi’s title as the biggest U.S. bank by assets while transforming the once-highly regarded Wachovia into an investment-management operation.
In becoming the latest big U.S. bank to bolster its assets by rummaging through the remains of a nearly defunct financial institution, Citi agreed to buy Wachovia’s banking operations for $1 per share. The deal gives Citi a strong retail-banking network – adding 3,300 branches and offices in 21 states – as well as $2.2 billion in deposits; but the bargain also brings City…
30Sep2008 | Money Morning | Comments Off | ContinuedA Black Hole Nearly Swallows Wall Street
Last week, scientists switched on the Large Hadron Collider in Switzerland. The Large Hadron Collider is the world’s largest and highest-energy particle accelerator. Scientists are hoping it will help unlock some of the mysteries of the universe. Non-scientists were fearful that it may create a black hole which could possibly swallow the Earth.
It looks like the non-scientists were right on the mark. A black hole appeared right in the middle of Wall Street and swallowed Lehman Brothers. The black hole also forced the Merrill Lynch Blundering Herd into the arms of Bank of America and giant insurer AIG into the…
22Sep2008 | Oxbury Research | Comments Off | ContinuedWe Live In Interesting, Incompetent Times
Epics and Ongoing Busts in the Financial Sector
There may be a major hurricane battering the oil rigs and refineries in the Gulf of Mexico and Texas, but an even bigger one is crushing many of the key banking firms in America.
One is a natural disaster — you can’t blame people for Hurricane Ike unless they’re too stupid to heed storm warnings and get themselves and their families out of danger. But you can definitely blame people — specifically executives and regulators — for the man-made disaster currently engulfing investment banks and the financial sector as a whole.
Hundreds of billions of…
16Sep2008 | Oxbury Research | Comments Off | ContinuedCredit Crunch Claims Two More (Part 1)
“At no time in history has the biggest money in the world been as MISALOCATED and invested as it is now.†–Ty Andros
…well put Mr. Andros. Today marked the worst day since markets opened after 9/11. Bonds soared while commodities, save gold, took it on the chin. By the way, if you have been a reader of mine, our long gold short oil position that I discussed several weeks back in an issue of Bourbon & Bayonet has done tremendously well in violent commodities market to say the least. You can visit the issue here. Moving on…
There is an enormous…
16Sep2008 | Oxbury Research | Comments Off | ContinuedBuyout of Merrill and Bankruptcy of Lehman Heightens Worry of U.S. Credit Crisis Pain Still to Come
After a weekend in which the deepening U.S credit crisis sent one top investment bank to bankruptcy court and a second into the arms of a “White Knight†suitor, U.S. stocks yesterday (Monday) recorded their worst day since the 9/11 terrorists attacks seven years ago. Indeed, the Dow Jones Industrial Average plunged more than 504 points, its biggest one-day point decline since Sept. 17, 2001 – the day the markets reopened for trading after the attacks on New York and Washington.
Wall Street entered last weekend anticipating a government bailout of Lehman Brothers Holdings Inc. (LEH), but exited with Merrill Lynch…
16Sep2008 | Money Morning | Comments Off | Continued
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