The news that Ken Lewis is out as Chairman of Bank of America has given the company’s stock a lift in pre-market trading. Prepare to watch BAC take off out of the gate today.
The Chrysler story continues to run. We reported last night that they would likely file for bankruptcy this morning, but there were some last-minute negotiations with creditors that some hoped might save the day. Today, however, the Wall Street Journal says a filing is imminent after those talks collapsed.
In the other game of chicken going on in Detroit, GM bondholders have counter-offered. They were offered a 10 percent stake in a reorganized GM for all their bonds. Now, according to a Bloomberg report, the bondholders say they’ll do a swap, but they want 51 percent.
Personal income fell 0.3 percent in March, and spending dropped 0.2 percent. The Wall Street Journal reports U.S. consumers elevated savings to cope with the recession. Meanwhile, new U.S. claims for unemployment benefits unexpectedly fell last week, providing some hope that the pace of layoffs may be slowing somewhat after months of crippling job losses.
In earnings news, Exxon Mobil reported a 58 percent drop in first-quarter net income, thanks to lower oil and gas prices and lower refining profits. Newell Rubbermaid first-quarter profit fell 41 percent, but cost cuts helped the company offset its customers’ inventory reductions and a consumer spending pullback. Procter & Gamble’s net fell 3.6 percent, due to charges related to the sale of its Folgers coffee business. Viacom said profit fell 34 percent on continuing advertising woes and weakness in its filmed-entertainment division. But Dow Chemical surprised with a higher quarterly results, thanks to cost cuts, the strong performance of its agricultural business, and lower raw material costs. Motorola posted a loss of $231 million, but forecast a narrower loss for the second quarter.
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