Market News: Bank of America, Best Buy, BlackBerry

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The stock markets in the United States dropped for the fifth consecutive day amid corporate earnings and uncertainties in the economy.

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Yesterday, the markets were negatively impacted by decline of retail sales and copper prices.Analysts also predicted that the oil prices will continue go down to as low as $40 a barrel.

Today, the Department of Labor reported that the number of people who filed for unemployment benefits increased by 19,000 to 316,000 for the week ended January 10.

On the other hand, data from the Federal Reserve Bank of New York manufacturing index expanded while a survey in the Philadelphia ares contracted than forecasts.


Meanwhile, the wholesale prices in the United States went down by 0.3% in December amid the slumping energy costs, an indication that the inflation irate unlikely to go up.

The Federal Reserve previously indicated its intention to be patient when it comes to increasing interest rate since the inflation is still below its 2% target.

Earlier today, the equity futures fluctuated after the Swiss National Bank surprisingly gave up its minimum exchange rate of 1.20 per euro. The central bank ended its policy designed to protect Swiss economy from the sovereign debt crisis in the European region.

Commenting on the news today, Thomas Garcia, head of equity trading at Thornburg Investment Management told Bloomberg, “There’s a lot of uncertainty today. There’s uncertainty about what to do with your Swiss holdings and their competitors, and commodities are all over the place.”

Garcia added, “The other thing is we’ve had mixed economic data and you’ve got earnings this week, which are going to have a big effect on the markets as people keep an eye on the consumer.”

U.S. Markets

  • Dow Jones Industrial Average (DJIA) – 17,320.71 (-0.61%)
  • S&P 500- 1,992.67 (-0.92%)
  • NASDAQ- 4,570.82 (-1.48%)
  • Russell 2000- 1,154.88 (-1.88%)

European Markets

  • EURO STOXX 50 Price EUR- 3,157.36 (+2.19%)
  • FTSE 100 Index- 6,498.78 (+1.73%)
  • Deutsche Borse AG German Stock Index DAX- 10,032.61 (+2.20%)

Asia-Pacific Markets

  • Nikkei 225- 17,108.70 (+1.86%)
  • Hong Kong Hang Seng Index- 24,350.91 (+0.99%)
  • Shanghai Shenzhen CSI 300 Index- 3,604.12 (+2.90%)

Stocks in Focus

Bank of America fell more than 5% to $15.20 per share after reporting lower than expected financial results for the fourth quarter. The bank posted $0.25 in earning per share on $18.96 billion in revenue compared with its $0.29 in earnings per share on $21.7 billion in revenue in same period last year. Analysts expect the bank to generate $0.32 EPS in $20.94 billion in revenue for the fourth quarter.

The stock price of Best Buy declined more than 14% to $34.29 per share. CEO Hubert Joly warned that external pressures including deflationary pricing, weak post-holiday demand for consumer electronics, lower interest in extended warranties might affect the company’s non-GAAP operating income. Best Buy forecasted that its sales in the first-half of the year will be flat or suffer a low, single-digit drop.

BlackBerry plummeted more than 19% to $10.10 per share after the Canadian technology company stated that it is not engaged in takeover discussion with Samsung Electronics. Yesterday, it was reported that Samsung is interested to acquire BlackBerry for $13.35 to $15.49 per share.


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