Page Perry's Market Monitor - January 23, 2009
There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:
• On Monday, the U.S. markets were closed.
• On Tuesday, the Dow Jones Industrial Average plunged 332 points.
• On Wednesday, the Dow Jones Industrial Average jumped 279 points.
• On Thursday, the Dow Jones Industrial Average fell 105 points.
• On Friday, the Dow Jones Industrial Average dropped 45 points and closed the week at 8078.
• On Tuesday, Barrack Obama was sworn in as the 44th President of the United States.
• Mitsubishi Motors is shutting down its biggest plant for 3 weeks as the slump in auto sales continues.
• In 2008, Toyota surpassed General Motors as the world’s largest automaker. However, the company is reportedly cutting production and considering job cuts.
• Overall current earnings reports are dismal although there have been exceptions.
• IBM’s earnings topped forecasts.
• Johnson & Johnson’s profits rose 14% but the company expressed concerns about 2009 results.
• Bank of New York Mellon’s earning fell 88%.
• Union Pacific’s fourth quarter profits rose 35%. The railroad company still plans to layoff approximately 5% of its workforce in the next six months.
• General Electric’s fourth quarter earnings declined 47% in 2008.
• Samsung Electronics announced its first-ever quarterly loss.
• American Airlines and United Airlines announced larger fourth quarter losses than they experienced in 2007.
• Southwest Airlines reported a fourth quarter loss but was profitable for the year.
• Sony reported that it expected to incur a $3 billion loss for 2008. If true, it would be the company’s first annual loss in 14 years.
• Apple Computer’s profits increased 2% and the company beat Wall Street expectations.
• Advance Micro Devices fourth quarter sales were off 33%.
• SunTrust Banks reported a quarterly loss of $1.08/share.
• Google announced fourth quarter profits and beat Wall Street estimates.
• The loss of jobs continues to be the biggest problem facing the economy. It is a vicious circle. As more people lose jobs, virtually all businesses suffer and greater strain is placed on governments to provide minimal levels of support.
• California’s jobless rate has hit 9.3% while Florida has 8.1% unemployment.
• Intel announced that it was cutting 5,000 to 6,000 jobs as part of a restructuring program.
• Microsoft confirmed that it was cutting approximately 5,000 jobs as software sales slump.
• Warner Bros., a Time Warner affiliate, is cutting 10% of its workforce. Approximately 800 people will be affected.
• Rohm & Haas is eliminating about 900 jobs.
• Bose Corporation is cutting 1,000 jobs or 10% of its workforce.
• Williams-Sonoma will slash 1,400 jobs.
• Compass Bank in Alabama is cutting 1,200 jobs.
• Harley-Davidson is eliminating over 1,000 jobs.
• Eaton Corporation, an industrial parts manufacturer, is cutting 5,200 more jobs.
• Schlumberger, the oilfield services company, will cut 5,000 jobs in the first half of 2009.
• Phillips-Van Heusen will close 175 stores.
• UBS announced that it will cut more jobs in 2009. Rumors are that as many as 5,000 more positions will be affected.
• Freddie Mac plans to ask the U.S. Treasury Department for an additional $35 billion in federal aid.
• New home construction has hit an all-time low.
• Capital One, the credit card issuer, wrote off $1 billion in bad loans in the fourth quarter. The company also reported that things were likely to get worse in 2009.
• The credit crisis has left thousands of charities low on cash.
Page Perry’s Market Monitor is published periodically to give investors an overview of certain recent developments impacting the economy and/or the investment markets.
