Weakness at GMAC also hurts results, but overseas vehicle sales help company top analysts' forecasts.
The nation's largest automaker, General Motors Corp., announced a large first-quarter loss Wednesday, due in large part to struggles from its former finance wing GMAC and slumping U.S. car sales.
But the loss was narrower than expected and sales topped forecasts, helping to lift shares of GM (GM, Fortune 500) 3.8% to $22 in pre-market trading.
GM posted a net loss of $3.3 billion, or $5.74 per share, which was wider than the $42 million, or 7-cent-a-share loss from continuing operations in the same period last year.
Excluding one-time losses from GMAC and $731 million in bankruptcy support for auto parts manufacturer Delphi, GM lost $350 million, or 62 cents per share. Analysts polled by Thomson Financial - who generally exclude one-time events from their forecasts - were looking for a deeper loss of $1.60 per share.
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Wednesday, April 30, 2008
Housing prices post record declines
Las Vegas, Miami and Phoenix all saw prices plummet by at least 20%. And so far, there is no sign of a bottom.
Home prices have posted another record decline, as most of the nation's largest markets suffered double-digit drops over last year, a survey released Tuesday shows.
The S&P Case/Shiller Home Price Index, which tracks 20 of the largest housing markets, showed prices plummeting by 12.7% in the 12 months ending February. That's the biggest fall since the index began tracking prices in 2000.
Of those 20 metro areas, 17 posted their largest year-over-year declines ever. Ten of the 20 cities posted double-digit dips.
The 10-city Case/Shiller index is down 13.6% year-over-year, the biggest drop since its launch in 1987.
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Home prices have posted another record decline, as most of the nation's largest markets suffered double-digit drops over last year, a survey released Tuesday shows.
The S&P Case/Shiller Home Price Index, which tracks 20 of the largest housing markets, showed prices plummeting by 12.7% in the 12 months ending February. That's the biggest fall since the index began tracking prices in 2000.
Of those 20 metro areas, 17 posted their largest year-over-year declines ever. Ten of the 20 cities posted double-digit dips.
The 10-city Case/Shiller index is down 13.6% year-over-year, the biggest drop since its launch in 1987.
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No Cushion Against Hubris
"The first panacea for a mismanaged nation is inflation of the currency; the second is war."
Not today, and not tomorrow: You can still spend your dollars and get value, as long as you are not traveling much in Europe or Japan.
It will not come next month, or next quarter: There is still time to covet and honor the American greenback as the strongest link of stability in the international financial system. You can still rely on your money, your banker and probably your broker, though you definitely want to keep an eye on your hedge fund manager.
But this is changing under our feet. The "golden moment" that enveloped the global economy for most of this decade is fading -- at least psychologically if not materially -- as we reach the end of an era of hubris in global affairs.
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Not today, and not tomorrow: You can still spend your dollars and get value, as long as you are not traveling much in Europe or Japan.
It will not come next month, or next quarter: There is still time to covet and honor the American greenback as the strongest link of stability in the international financial system. You can still rely on your money, your banker and probably your broker, though you definitely want to keep an eye on your hedge fund manager.
But this is changing under our feet. The "golden moment" that enveloped the global economy for most of this decade is fading -- at least psychologically if not materially -- as we reach the end of an era of hubris in global affairs.
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Friday, April 18, 2008
Infosys scouting for buys in Europe, US
Owing to economic slowdown and consequently lower valuations, Infosys Technologies is eyeing acquisitions in Europe or US. Speaking to Business Line, Mr T.V. Mohandas Pai, Member of Board and Director- Human Resources, Education and Research and Administration, Infosys, said the company was looking at acquiring firms in the BFSI, communication or manufacturing space. “We are focusing on adding vertical expertise, and not capacity building,” he said, without sharing any other details. For the year ended March 2008, the company had Rs 6,429 crore as cash and bank balance.
Infosys’ first acquisition was in Australia where it bought 100 per cent stake in Expert Information Services for about $22.9 million (Rs 92 crore). The company was renamed Infosys Technologies (Australia) Pvt Ltd. The company signed a $250 million seven-year deal to acquired three captive BPOs from the Netherlands-based Philips NV, including three shared centres in India, Poland and Thailand.
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Infosys’ first acquisition was in Australia where it bought 100 per cent stake in Expert Information Services for about $22.9 million (Rs 92 crore). The company was renamed Infosys Technologies (Australia) Pvt Ltd. The company signed a $250 million seven-year deal to acquired three captive BPOs from the Netherlands-based Philips NV, including three shared centres in India, Poland and Thailand.
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Colombia Trade Accord
Re “Time for the Colombian Trade Pact” (editorial, April 12):
It is not yet time for Congress to ratify the United States-Colombia Free Trade Agreement.
As you note, in response to American pressure, last year Colombia established a specialized group of prosecutors to focus on thousands of unsolved killings of trade unionists, and this group is making some headway.
But it is naïve to assume that real progress will continue without sustained pressure. Once the trade pact is ratified, the main incentive for President Álvaro Uribe’s administration — which has stigmatized unionists as terrorists — to support these investigations will vanish.
Your proposal to keep the pressure on through the “powerful tool” of conditions on military aid won’t do the trick: American administrations from both parties have consistently failed to enforce existing human rights conditions on such assistance.
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It is not yet time for Congress to ratify the United States-Colombia Free Trade Agreement.
As you note, in response to American pressure, last year Colombia established a specialized group of prosecutors to focus on thousands of unsolved killings of trade unionists, and this group is making some headway.
But it is naïve to assume that real progress will continue without sustained pressure. Once the trade pact is ratified, the main incentive for President Álvaro Uribe’s administration — which has stigmatized unionists as terrorists — to support these investigations will vanish.
Your proposal to keep the pressure on through the “powerful tool” of conditions on military aid won’t do the trick: American administrations from both parties have consistently failed to enforce existing human rights conditions on such assistance.
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Citi posts loss, cuts 9,000 more jobs
Financial services giant records $5.1 billion loss and more than $15 billion in writedowns, and says it will eliminate more positions.
Citigroup delivered yet another quarter of devastating results Friday, this time losing more than $5 billion due to troubles in its fixed-income business and higher consumer credit costs, adding it would cut an additional 9,000 jobs.
The New York-based company also recorded more than $15 billion in writedowns, with the lion's share coming from subprime-related direct exposures.
But investors cheered the news, sending shares of Citigroup (C, Fortune 500) more than 6% in early trading, as the results were not as bad as some had feared.
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Citigroup delivered yet another quarter of devastating results Friday, this time losing more than $5 billion due to troubles in its fixed-income business and higher consumer credit costs, adding it would cut an additional 9,000 jobs.
The New York-based company also recorded more than $15 billion in writedowns, with the lion's share coming from subprime-related direct exposures.
But investors cheered the news, sending shares of Citigroup (C, Fortune 500) more than 6% in early trading, as the results were not as bad as some had feared.
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As the FBI steps in, the subprime witch hunt begins
The FBI says that deceptive practices at hedge funds and some banks may have made the subprime disaster worse. According to Reuters, the head of the agency said the bureau's investigation of potential fraud in the U.S. home mortgage industry now encompasses 19 companies in "cases that may have a substantial impact on the marketplace."
While insider trading and accounting fraud may be part of any charges which emerge, one of the biggest single issues may be the sales practices of the firms which sold subprime paper to their clients. The subprime instruments were often presented as having high credit ratings and safe risk profiles. Of course, it didn't work out that way. Another problem may be whether mortgage banks were completely honest in what they told home-buyers about how their loans would work as their interest rates increased over time.
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While insider trading and accounting fraud may be part of any charges which emerge, one of the biggest single issues may be the sales practices of the firms which sold subprime paper to their clients. The subprime instruments were often presented as having high credit ratings and safe risk profiles. Of course, it didn't work out that way. Another problem may be whether mortgage banks were completely honest in what they told home-buyers about how their loans would work as their interest rates increased over time.
Read Complete Story
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