Top 10 News Items 7/12-7/16: Goldman to Pay $550M to Settle with SEC, BP's New Cap is Working!, FinReg Approved by US Senate
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Here is a recap of the top news items from this week on Wall Street:
1. Goldman Sachs (NYSE: GS) shares rose more than 6% to finish this week's trading session (over the course of Thursday and Friday) following news that the bank and the SEC have reached an agreement to settle the civil fraud charges brought against the firm for allegedly misleading investors about mortgage-backed securities. Goldman will be required to pay $300 million in fines, with the rest of the money going to compensate investors who lost money on the investments in question. Although speculation on a possible settlement has been discussed for quite some time now, the news is a major positive for GS holders as this issue was the stock's largest overhang.
2. Shares of BP (NYSE: BP) rallied about 8% on Thursday of this week as the company's latest attempt at capping the gushing well in the Gulf of Mexico appears to be working. The cap was designed to either completely shut down the well, or allow BP to capture more of the oil spill into the Gulf of Mexico. The company and the government are still working on a relief well, which has been delayed by scientific tests, as a final solution to one of the worst environmental disasters in the nation's history.
3. In a 60-39 vote, the sweeping overhaul of financial regulation successfully passed through the Senate this week. Following the passage, President Obama suggested that the new rules will be integrated with the intention to protect consumers, specifically from similar developments which tanked the global economy over the last two years.
4. Apple (Nasdaq: AAPL) held a news conference on Friday afternoon this week, hoping to reassure loyal techies that the recent issues with the iPhone 4 are temporary and currently being worked out aggressively. In a 15 minute presentation held in Cupertino, Jobs declared that “We’re not perfect", eventually announcing that the company would provide a free bumper to any user which purchased a faulty iPhone 4.
5. Earnings season just kicked off this week, with notable reports coming from the Financial group: JPMorgan returned solid results, however remained flat, Citi (NYSE: C) was mostly mixed and BofA (NYSE: BAC) shares sold-off by more than 9% on Friday as traders sold the news.
6. In the Tech sector, earnings highlights included: Intel (Nasdaq: INTC), Google (Nasdaq: GOOG) and AMD (NYSE: AMD). Intel blew out results and traded higher throughout the week, Google disappointed and shares fell almost 7%, and AMD topped the Street estimates, however shares moved lower.
7. Shares of Hewitt Associates (NYSE: HEW) surged 32% on Monday of this week as Aon (NYSE: AON) announced that it has agreed to acquire the company for $50/share. The total deal is being valued around $4.9 billion.
8. Elsewhere on the earnings front, Alcoa (NYSE: AA) surprised to the upside, CSX (NYSE: CSX) beat the Street but shares were flat and GE (NYSE: GE) shares sold off as the top line missed.
9. Playboy (NYSE: PLA) shares rocketed 40% higher on Monday following a bid from Hugh Hefner to take the company private at $5.50/share. Adding to the M&A activity, FriendFinder, owner of Penthouse, made a $210 million bid for the company.
10. The Fed released the minutes from its FOMC meeting from last month this week, leaving plenty of room for further stimulus. The Fed cut growth forecasts in the wake of the European debt crisis, the volatility on Wall Street, the struggling housing market and suffocating unemployment rates that continue to linger on during the recovery. The Fed revised its outlook for growth in the U.S. economy to between 3 percent and 3.5 percent for the remainder of the year, down from previous forecasts of 3.2 percent to 3.7 percent growth.
1. Goldman Sachs (NYSE: GS) shares rose more than 6% to finish this week's trading session (over the course of Thursday and Friday) following news that the bank and the SEC have reached an agreement to settle the civil fraud charges brought against the firm for allegedly misleading investors about mortgage-backed securities. Goldman will be required to pay $300 million in fines, with the rest of the money going to compensate investors who lost money on the investments in question. Although speculation on a possible settlement has been discussed for quite some time now, the news is a major positive for GS holders as this issue was the stock's largest overhang.
2. Shares of BP (NYSE: BP) rallied about 8% on Thursday of this week as the company's latest attempt at capping the gushing well in the Gulf of Mexico appears to be working. The cap was designed to either completely shut down the well, or allow BP to capture more of the oil spill into the Gulf of Mexico. The company and the government are still working on a relief well, which has been delayed by scientific tests, as a final solution to one of the worst environmental disasters in the nation's history.
3. In a 60-39 vote, the sweeping overhaul of financial regulation successfully passed through the Senate this week. Following the passage, President Obama suggested that the new rules will be integrated with the intention to protect consumers, specifically from similar developments which tanked the global economy over the last two years.
4. Apple (Nasdaq: AAPL) held a news conference on Friday afternoon this week, hoping to reassure loyal techies that the recent issues with the iPhone 4 are temporary and currently being worked out aggressively. In a 15 minute presentation held in Cupertino, Jobs declared that “We’re not perfect", eventually announcing that the company would provide a free bumper to any user which purchased a faulty iPhone 4.
5. Earnings season just kicked off this week, with notable reports coming from the Financial group: JPMorgan returned solid results, however remained flat, Citi (NYSE: C) was mostly mixed and BofA (NYSE: BAC) shares sold-off by more than 9% on Friday as traders sold the news.
6. In the Tech sector, earnings highlights included: Intel (Nasdaq: INTC), Google (Nasdaq: GOOG) and AMD (NYSE: AMD). Intel blew out results and traded higher throughout the week, Google disappointed and shares fell almost 7%, and AMD topped the Street estimates, however shares moved lower.
7. Shares of Hewitt Associates (NYSE: HEW) surged 32% on Monday of this week as Aon (NYSE: AON) announced that it has agreed to acquire the company for $50/share. The total deal is being valued around $4.9 billion.
8. Elsewhere on the earnings front, Alcoa (NYSE: AA) surprised to the upside, CSX (NYSE: CSX) beat the Street but shares were flat and GE (NYSE: GE) shares sold off as the top line missed.
9. Playboy (NYSE: PLA) shares rocketed 40% higher on Monday following a bid from Hugh Hefner to take the company private at $5.50/share. Adding to the M&A activity, FriendFinder, owner of Penthouse, made a $210 million bid for the company.
10. The Fed released the minutes from its FOMC meeting from last month this week, leaving plenty of room for further stimulus. The Fed cut growth forecasts in the wake of the European debt crisis, the volatility on Wall Street, the struggling housing market and suffocating unemployment rates that continue to linger on during the recovery. The Fed revised its outlook for growth in the U.S. economy to between 3 percent and 3.5 percent for the remainder of the year, down from previous forecasts of 3.2 percent to 3.7 percent growth.
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