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Updated: 2 hours 42 min ago

Wells Fargo shares slip 1.4% premarket after profit and revenue miss

Fri, 01/12/2018 - 08:19

Wells Fargo & Co. shares slid 1.4% in premarket trade Friday, after the bank posted weaker-than-expected earnings for the fourth quarter. The bank said it had net income of $6.25 billion, or $1.16 a share, in the quarter, up from $5.27 billion, or 96 cents a share, in the year-earlier period. Revenue fell to $22.05 billion from $22.24 billion. The FactSet consensus was for EPS of $1.23 and revenue of $22.45 billion. Earnings were boosted by a net benefit from the tax bill signed into law in December, making Wells Fargo one of few banks not to take a charge. Wells Fargo has a net deferred tax liability instead of a deferred tax asset, which has caused other banks to write down part of their tax liability. The benefit came to $3.35 billion, or 67 cents a share, which was offset by $3.25 billion in pretax charges related to litigation costs. The bank also booked a pretax gain of $848 million related to the sale of Wells Fargo Insurance Services USA. Shares have gained 16% in the last 12 months, while the S&P 500 has gained 21%.

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J.P. Morgan Chase's CIB revenue falls below expectations, weighed by weak fixed income results

Fri, 01/12/2018 - 07:33

Shares of J.P. Morgan Chase & Co. slipped 0.3% in premarket trade Friday, after the banking giant reported fourth-quarter results, which showed corporate and investment banking (CIB) revenue falling well below expectations. Although overall adjusted earnings per share, which excluded a large negative impact from tax legislation, and net revenue beat expectations, CIB revenue fell 12% to $7.48 billion, below the FactSet consensus of $7.91 billion, as net income fell 32% to $2.3 billion. Within the group, banking revenue rose 10% to $3.1 billion, boosted by 10% growth in investment banking revenue. But markets and investor services revenue tumbled 22% to $4.4 billion, weighed down by a 26% decline in markets revenue. Within markets, fixed income markets revenue plunged 34% and equity markets revenue was flat. The stock has rallied 15.5% over the past three months through Thursday, while the SPDR Financial Select Sector ETF has climbed 10.9% and the Dow Jones Industrial Average has run up 12.0%.

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Facebook shares drop nearly 4% premarket after changes favoring friend posts ahead of business

Fri, 01/12/2018 - 06:58

Facebook shares are down nearly 4% in premarket trading Friday as investors react to news the social media giant is making major changes to its news feed that may come at the expense of ad dollars. Facebook said late Thursday it will now prioritize personal posts from family and friends over videos and posts from businesses and news media. In a blog post, CEO Mark Zuckerberg said the sweeping changes are being made to "encourage meaningful interactions between people," even as he acknowledged it may hurt the company's bottom line. Last quarter, the company took in $10.14 billion in ad revenue from 6 million customers, mostly small- and medium-sized businesses. Facebook has come under criticism over the content of its news feed in recent years, including its role in spreading disinformation around the presidential election.

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Euro jumps to 3-year high above $1.21 after German lawmakers agree on coalition blueprint

Fri, 01/12/2018 - 05:16

The euro jumped to its highest level against the dollar since early 2015 on Friday after German lawmakers agreed on a coalition blueprint, more than three months after the country's general election. The euro bought $1.2118, trading around its highest level since early January three years ago, according to FactSet data. The shared currency bought $1.2034 late Thursday in New York. The pop came after reports Chancellor Angela Merkel's conservative CDU party and Martin Schulz's center-left SPD after all-night talks agreed to a blueprint for formal coalition negotiations. The Germans voted in a general election on Sept. 24, where Merkel's party came out with the most votes, but fell short of an outright majority. Merkel first tried to form a coalition with the Greens and the FDP, but turned to the social democrats after those talks collapsed. The SPD was also in a coalition with the CDU in the previous government, but had vowed not to take on the role as junior partner again.

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Dow industrial futures jump 100 points as dollar sags

Fri, 01/12/2018 - 05:03

U.S. stock futures were indicating a stronger open for Wall Street on Friday, keying off a sharply weaker U.S. dollar, said analysts. Dow Jones Industrial Average futures jumped 102 points, or 0.4%, to 25,658, while S&P 500 futures rose 5.75 points, or 0.2%, to 2,775.25. Nasdaq-100 futures gained 11.25 points, or 0.2%, to 6,738.25. The jump in stock futures coincided with news that German lawmakers had reached a deal on a ruling coalition. That news sent the euro flying to three-year highs against the dollar, which weakened across the board. Investors will get important updates on U.S. consumer price inflation and retail sales later on Friday.

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Trump expected to extend waiver on Iran sanctions: reports

Thu, 01/11/2018 - 22:31

President Donald Trump plans to extend a waiver on sanctions against Iran as part of the 2015 nuclear deal, according to news reports. The Associated Press and Bloomberg News reported that Trump will announce the waiver Friday morning. Failure to waive the sanctions would effectively kill the deal reached between Iran and the West that limits Iran's nuclear program. Trump has vowed to end the agreement, calling it the "worst deal ever." Congress requires the president to renew the waiver every 90 days. But Bloomberg also said the Trump administration is preparing new targeted sanctions related to Iran's ballistic missile testing, human rights record and hacking activities.

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Trump cancels trip to London over protest fears: reports

Thu, 01/11/2018 - 19:51

President Donald Trump has canceled plans to visit London next month over fears of mass protests, according to news reports late Thursday. The Guardian and Sky News both said Secretary of State Rex Tillerson will instead travel to the U.K. to mark the opening of the new U.S. Embassy in London. The Guardian said plans for a state visit had been previously scaled back to a "working visit" for Trump for the ribbon-cutting and for meetings with Prime Minister Theresa May, but that even that more modest trip appears to have been abandoned. Trump's travel ban targeting largely Muslim countries and his retweeting of a British far-right group has spurred much criticism in the U.K. Trump is expected to fly to Europe for the World Economic Forum in Davos, Switzerland, at the end of January.

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Fiat Chrysler to invest more than $1 billion in Michigan plant, plans $2,000 bonus for U.S. employees

Thu, 01/11/2018 - 18:03

Fiat Chrysler Automobiles NV said late Thursday it plans to invest more than $1 billion to modernize a plant in Michigan to make the next generation of its Ram heavy-duty trucks by 2020. The production of the trucks will be relocated to the Michigan factory from a plant in Mexico, Fiat Chrysler said. The move will create 2,500 new jobs, the company said, adding the announcement was made possible in part by the U.S. tax overhaul. The Mexican plant will be "repurposed" to make future commercial vehicles for the global market, the car maker said. In the same statement, Fiat Chrysler said it will pay a $2,000 bonus to about 60,000 hourly and salaried U.S. employees, excluding senior executives, in the second quarter. American Depositary shares of Fiat Chrysler rose nearly 5% in late trading after ending the regular session up 7.2%.

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S&P cuts Brazil's sovereign rating by one notch to BB-

Thu, 01/11/2018 - 17:16

S&P Global Ratings on Thursday cut Brazil's long-term foreign and local currency sovereign credit ratings by one notch to 'BB-' from 'BB'. The outlook on the ratings is stable. "The stable outlook reflects our view that there is a less than one-in-three likelihood that we could raise or lower the ratings on Brazil over the coming year," said credit analyst Lisa Schineller in a statement. It also is indicative of Brazil's stable external position and the strength of its monetary policy that help to offset fiscal weakness and lower economic growth outlook than its peers. BB- is generally viewed as "speculative" by lenders.

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AMD shares slide as chip maker admits greater Spectre vulnerability

Thu, 01/11/2018 - 17:08

Advanced Micro Devices Inc. admitted late Thursday that its exposure to the Spectre chip vulnerability is wider than first thought. AMD shares fell 3.1% to $11.76 after hours. AMD said in a statement it defined additional steps "through a combination of processor microcode updates and OS patches that we will make available" to Ryzen and EPYC customers starting this week. Last week, AMD said there was a near zero risk of its chips being susceptible to the so-called Spectre chip exploit.

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Finisar CEO Jerry Rawls to retire, company appoints Michael Hurlston new CEO

Thu, 01/11/2018 - 16:41

Finisar Corp. said late Thursday co-founder and Chief Executive Jerry Rawls has retired, and that Michael Hurlston, a former Broadcom executive, has been appointed CEO and a director, effectively immediately. Hurlston and Rawls "will work together to ensure a smooth transition," and Rawls will continue to serve as a director, the company said in a statement. Shares of Finisar rose 2% in late trading after ending the regular session up 2.4%.

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IBM installs new CFO

Thu, 01/11/2018 - 16:30

International Business Machines Corp. said late Thursday that it has installed James Kavanaugh as chief financial officer, and former CFO Martin Schroeter will take a new role as senior vice president of global markets. Kavanaugh was senior vice president, finance and operations, the company said. IBM has not yet made any decisions about the executives' compensation. Both executives will participate in the company's fourth-quarter earnings call on Jan. 18. IBM stock is down a fraction to $164.04 after hours. Over the past 12 months IBM stock has lost 2%, as the S&P 500 index rose 21%. The Dow Jones Industrial Average , of which IBM is a component, has gained 27%.

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Apple, HP lead PC shipment growth in fourth quarter

Thu, 01/11/2018 - 16:30

PC makers saw their first holiday quarter rise in shipments in six years, according to the International Data Corp. on Thursday. Fourth-quarter shipments rose 0.7% to 70.58 million units, with the largest gains at HP Inc. with a 8.3% rise, and Apple Inc. , with a 7.3% rise. For the year, however, PC shipments declined 0.2% to 259.53 million units, but HP and Apple led gainers. Gartner, however, showed slightly different numbers with PC shipments declining 2% to 71.56 million units for the fourth quarter, and falling 2.8% to 262.54 million units for the year. HP and Apple also led PC shipment growth for the fourth quarter and the year in the Gartner data.

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Trump says he probably has a 'good relationship' with Kim Jong Un

Thu, 01/11/2018 - 16:28

President Donald Trump told The Wall Street Journal in an interview that he has a positive relationship with North Korea's leader, with whom he has shared a number of insults. "I probably have a very good relationship with Kim Jong Un," Trump said. When asked if he's spoken with Kim, Trump said he didn't want to comment. "I'm not saying I have or haven't. I just don't want to comment."

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DraftKings plans to hire hundreds, announces new Boston headquarters

Thu, 01/11/2018 - 16:28

Daily-fantasy startup DraftKings Inc. said late Thursday it has begun "an aggressive hiring campaign" to grow the company to more than 700 employees by mid-2019, from the current 425 employees. At least 600 of the positions would be based in Boston, the company said in a statement. The company also announced plans for a new headquarters in Boston, saying it would more than double the size of the company's current office. DraftKings and FanDuel called off their attempted "merger of equals" in July after the Federal Trade Commission moved to block the deal.

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Stocks end at records, driven by rally in energy shares

Thu, 01/11/2018 - 16:06

U.S. stock-market indexes closed at records on Thursday, driven by a rally in energy and materials sectors, which followed rising oil prices higher. The rally comes a day after the S&P 500 and Nasdaq suffered the first down day of the year on anxieties about appetite for Treasurys from the world's second-largest economy, China. The S&P 500 gained 19.33 points, or 0.7%, to 2,767.56. The tech-heavy Nasdaq Composite index advanced by 58.21 points, or 0.8%, to 7,211.78. The Dow Jones Industrial Average rose 205.60 points, or 0.8%, to 25,574.73. Among the best performers on Wall Street, shares of Xerox rose 5.2%, after The Wall Street Journal reported that the company is in talks to potentially do a major deal with Japan's Fujifilm Holdings Corp.

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Amazon's stock jumps toward 7th-straight record close

Thu, 01/11/2018 - 15:59

Amazon.com Inc.'s stock shot up 1.6% in afternoon trade Thursday, as it extends its win streak to all eight sessions of this year, after a couple Wall Street analysts boosted their price targets above the $1,400 level. The win streak would be the longest since the 8-day stretch ending May 30, 2017. The stock is also on track for a seventh-straight record close to lift Amazon's market capitalization to $614.06 billion, enough to make Amazon the fourth-most valuable S&P 500 component. Analyst Scott Devitt at Stifel Nicolaus kept his rating at buy, but raised his stock price target to $1,425 from $1,313, citing expectations of strong fourth-quarter results, which are projected by FactSet to be released on Feb. 1, given healthy holiday e-commerce sales, continued momentum in Prime membership adoption and continued strength in its Amazon Web Services cloud business. UBS kept its rating at buy, but boosted its price target to $1,440 from $1,250. Amazon's stock had run up 28% over the past three months, while the Dow Jones Industrial Average has climbed 28%.

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Group of senators say they have reached an agreement on immigration

Thu, 01/11/2018 - 15:42

Six senators -- Republicans Lindsey Graham, Jeff Flake and Cory Gardner, and Democrats Dick Durbin, Michael Bennet and Robert Menendez -- said they have reached an agreement on immigration that, they say, addresses border security, the diversity visa lottery, chain migration/family renunification and the Dream Act. The senators say they are working to build support for that deal in Congress.

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NBC expects to garner $1.4 billion in ad revenue from Super Bowl, Winter Olympics

Thu, 01/11/2018 - 15:28

Comcast Corp. expects NBC's advertising revenue for Super Bowl LII to be as much as $500 million. Shares of Comcast were up more than 3% during intraday trade on Thursday. NBC's head of ad sales, Dan Lovinger, told reporters during a conference call on Thursday that NBC is taking in $5 million per 30-second ad spot during the Super Bowl on Feb. 4, and that a handful of open spots remain, according to media reports. Lovinger said the network expects it to set the single-day record for advertising generated by a single media company. The Super Bowl telecast will be followed by a special broadcast of one of TV's most popular shows, "This Is Us," which is expected to have added to demand. Lovinger also said the network is expecting to bring in roughly $900 million in ad revenue from the upcoming Winter Olympics, which would put the total ad revenue for both events at $1.4 billion. Comcast shares have gained more than 18% in the last 12 months, while the S&P 500 index is up more than 21% and the Dow Jones Industrial Average is up more than 27%.

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Oil prices up a fourth session; natural-gas futures at 6-week high

Thu, 01/11/2018 - 14:49

Oil prices settled higher Thursday for a fourth session in a row. Prices got a boost as recent data showed U.S. crude supplies falling for eight straight weeks. Traders awaited the Trump administration's decision on whether to extend temporary waivers on sanctions against Iran. February West Texas Intermediate crude rose 23 cents, or 0.4%, to settle at $63.80 a barrel on the New York Mercantile Exchange. That was the highest finish since Dec. 9, according to FactSet data. Natural-gas futures, meanwhile, rose to a six-week high after a record weekly drop in U.S. supplies of the commodity. February natural gas rose 17.8 cents, or 6.1%, to settle at $3.084 per million British thermal units.

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