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Fourth-Quarter GDP Revised Down; Jobless Claims Rise as Expected
The U.S. economy was weaker at the end of 2008 than previously believed, falling by the most in 26 years, while corporate profits lost more than a quarter of their value. Separately, new U.S. claims for state unemployment benefits rose as expected last week while total claims soared to a record high over 5.5 million, suggesting the economy continues to shed jobs at a rapid clip.
AIG Fights a Fire at Its Paris Unit
Amid the flap over bonuses at American International Group Inc. (NYSE:AIG) two of the company’s top managers in Paris have resigned. Their moves have left the giant insurer and officials scrambling to replace them to avoid an unlikely but expensive situation in which billions in AIG trading contracts could default.
Top Barclays Officers Land in Hot Seat
Barclays PLC (NYSE:BCS) Chief Executive John Varley and Chairman Marcus Agius have been among the Teflon men of the financial crisis, deflecting criticism and hanging on to their posts as counterparts at rival banks fell amid heavy losses and government bailouts.
BofA to Fold Premier Into Merrill Unit
Bank of America Corp. (NYSE:BAC) is folding its Premier Banking unit into Merrill Lynch Global Wealth Management, laying off several hundred workers in a division once touted as a potential driver of new revenue and profit.
GM’s UAW Buyout Is Said to Exceed 6,000 U.S. Workers
General Motors Corp. (NYSE:GM) has persuaded more than 6,000 United Auto Workers members to take buyouts, meeting internal company goals and almost doubling a Barclays Capital estimate, people familiar with the results said. The Detroit-based automaker will announce the participation today, said the people, who asked not to be identified because the tally is unofficial. The buyouts, about 10 percent of GM’s UAW workforce, may open slots for GM to hire workers for half the current union rate.
Has Oracle run out of companies to buy?
Last week, Oracle Corp.’s (NASDAQ:ORCL) first dividend payment in the company’s nearly 30-year history was a signal to many on Wall Street that the software giant is slowing down its acquisition frenzy. Oracle’s spree kicked into high gear in 2006, when the company bought 18 firms. However, it appears to be slowing down, with 13 deals in 2007 and 10 last year.
IBM Cuts Jobs as It Seeks Stimulus Money
Reports of deep job cuts at International Business Machines (NYSE:IBM) come at a potentially delicate time for the company—just as it is hoping to secure money from the federal stimulus package. The company will lay off as many as 5,000 U.S. workers in its Global Business Services unit, transferring some of the work they performed to India, according to media reports.
GameStop Fourth-Quarter Profit Rises on Wii, ‘Guitar Hero’
GameStop Corp. (NYSE:GME), the world’s largest video-game retailer, said fourth-quarter profit rose 22 percent on holiday sales of “Guitar Hero” and Nintendo Co.’s (TYO:7974) Wii console. Net income increased to $232.3 million, or $1.39 a share, from $189.8 million, or $1.14, a year earlier, the Grapevine, Texas-based company said today in a statement distributed by Business Wire.
Dr Pepper Snapple posts $621M loss in 4th quarter
Dr Pepper Snapple Group Inc. (NYSE:DPS) said Thursday that it lost $621 million in the fourth quarter as it wrote down assets and spent heavily on restructuring and severance, but its adjusted profit was better than Wall Street expected. The seller of drinks such as A&W, Squirt and Hawaiian Punch lost $2.44 per share in the quarter that ended Dec. 31, compared to a profit of $138 million, or 54 cents per share, a year earlier.
Morgan Stanley, MUFG to merge Japan brokerages
Morgan Stanley (NYSE:MS) and Mitsubishi UFJ Financial Group (NYSE:MTU) will establish a new securities company in Japan by merging their local brokerage units by next spring, the two companies said Thursday. As widely expected, Mitsubishi UFJ Financial Group Inc., Japan’s biggest banking group known as MUFG, will take a 60 percent stake in the new entity. The U.S. investment firm will own the remaining 40 percent share.
The Apps Battle Heats Up
On Apr. 1, Mike Lazaridis, co-CEO of Research in Motion (NASDAQ:RIMM), is expected to take the stage at the wireless industry’s annual trade show in Las Vegas and open the virtual doors to a much anticipated new online store. Now, Nokia (NYSE:NOK), Microsoft (NASDAQ:MSFT), and Palm (NASDAQ:PALM) plan to follow RIM with virtual software stores of their own this year.
