Top 10 News Items for 08/10 - 08/14: FOMC Stimulates; Apple's Big Announcement; the Face of Facebook; U.S. Sells Out...of AIG; DJIA Adds New Component

September 14, 2012 4:52 PM EDT
  1. On Thursday, the FOMC announced new stimulus measures to spur growth and reduce unemployment in the U.S.

    The Fed's Operation Twist will continue, while the FOMC said it will purchase additional agency mortgage-backed securities at a pace of $40 billion per month. Measures will increase the Fed's long-term securities by about $85 billion each month. Click here for more.

  2. On Wednesday, Apple (Nasdaq: AAPL) unveiled its next cash cow: the iPhone 5. According to the spec sheet, the iPhone 5 is 18 percent thinner and 20 percent lighter than the iPhone 4S and boasts a number of new features, including an all glass and aluminum body, 4-inch retina display, 4G LTE connectivity, and new A6 chip. The chip is said to be twice as fast as the outgoing A5, which is a good thing given the higher download speeds bequeathed on the Apple community (yes, we know the iPad has 4G. But iPhone sales are leagues above tablet far).

    Pre-orders Friday are said to have sold out within the first hour in all available markets, with two-week shipment times expected.

    For more color on the launch, click here.

  3. Facebook (Nasdaq: FB) CEO Mark Zuckerberg issued his first interview post-IPO on Tuesday. Speaking with Tech Crunch, Zuckerberg said he was disappointed with the performance of the stock since going public on May 18th. Additionally, he highlighted how Facebook is making stronger moves into mobile, with most users accessing the site via a mobile device now.

    Other highlights include:
    • The biggest mistake was betting on HTML5;
      Facebook is not building it own smartphone, due to it not being the right strategy; and
      Facebook does a billion search queries per day.
    Investors liked seeing Zuckerberg and appreciated his comments, sending shares over 12 percent higher for the rest of the week.

  4. The U.S. Treasury sold another large slug of AIG (NYSE: AIG) common stock it acquired during the 2008 bailout of the large insurer. According to AIG today, the insurer sold 636.9 million shares of AIG common stock, par value $2.50 per share (AIG Common Stock) by the U.S. Department of the Treasury (Treasury). Treasury received proceeds of approximately $20.7 billion from the sale of AIG Common Stock in the offering.

    Following the massive offering, the U.S. holds just a 15.9 percent stake in AIG, from 53.4 percent originally. For more, click here.

  5. Friday, UnitedHealth Group (NYSE: UNH) said it would be replacing Kraft Foods (Nasdaq: KFT) in the Dow Jones Industrial Average, which boasts just 30 tracked stocks. The change will be effective with the opening of trading on Monday, September 24.

    The change was prompted by Kraft's plan to spin-off its North American grocery business, to be named Kraft Food Group on Oct. 1, 2012. Following the spin-off Kraft Foods Inc. will be renamed Mondelez.

  6. On Wednesday, Germany's Bundesverfassungsgericht (it's top court) ruled that Germany would be able to ratify the European Stability Mechanism. Though the move was largely expected, one of the biggest factors traders were watching was whether or not there would be restrictions placed on the ruling. However, the only real item the court made sure of was that no increase in Germany's financial exposure should result without parliament's approval.

  7. Morgan Stanley (NYSE: MS) and Citigroup (NYSE: C) reached agreement earlier in the week, whereby Morgan Stanley will purchase Citi’s 14 percent stake in Morgan Stanley Smith Barney Holdings LLC (MSSB), together with the transfer of approximately $5.5 billion of deposits at no premium, at an implied 100 percent valuation of $13.5 billion. Though chatter about hte move has been alive for a while, the announcement provided a boost for both financials.

    Citi and Morgan Stanley ended the week at the highest levels since April.

  8. Plains Exploration & Production (NYSE: PXP) said it would acquire interest in certain deepwater Gulf of Mexico oil and gas properties from BP Exploration & Production Inc. and BP America Production Company, of BP plc (NYSE: BP), for $5.55 billion.

    The properties include the BP-Operated Marlin, Dorado and King Fields (collectively the Marlin Hub, 100 percent working interest), BP-Operated Horn Mountain Field (working interest 100 percent), BP-Operated Holstein Field (working interest 50 percent), BP non-operated Diana-Hoover Field (33.33 percent working interest, operated by ExxonMobil) and BP non-operated Ram Powell Field (31 percent working interest, operated by Shell Offshore Inc.).

    For the release, click here.

  9. The Reuters/University of Michigan U.S. consumer sentiment survey showed a surprising jump in confidence for September. Preliminary puts the index at 79.2, from 74.3 in August and expectations of a drop to 74.

    The result aided markets in moving higher Friday. The headline number follows jobs numbers for August which showed stagnant growth, at best.

    For more color, click here.

  10. Crude moved to its highest levels since May following Fed stimulus measures. In early trading Friday, WTI crude futures went above the $100 level on expectations for increased global demand, though October contracts ended up falling bacl to the $99 level in the afternoon session.

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