Top 10 News Items 5/18-5/22: S&P Places UK Ratings on Negative Outlook, Creating Fears That US Could Be Next; BankUnited Closed by Office of Thrift Supervision; 2 IPO's Hit the Market

May 22, 2009 4:18 PM EDT
Here is a recap of the top news items from this week on Wall Street:

1. Stocks slumped Thursday as S&P moved the U.K.'s ratings outlook to Negative. The news sparked market-wide fears that the U.S. could soon be next. Selling pressure intensified as PIMCO's Bill Gross appeared on CNBC calling the U.S. and U.K. "relative twins". While Gross does not believe this will happen, he sees increasing risks of such a possiblity.

2. Also Thursday, The Office of Thrift Supervision closed the $13.1 billion BankUnited (Nasdaq: BKUNA), marking the largest bank to go under as a result of the financial crunch so far. According to the FDIC, which was named receiver of the bank, BankUnited was critically undercapitalized and in an unsafe condition to conduct business.

3. Two IPO's were successfully launched this week: SolarWinds (NYSE: SWI) and OpenTable (Nasdaq: OPEN). After pricing at $12.50, shares of SolarWinds closed the week at about $13.75, while shares of OpenTable closed around $29.80 after pricing at $20.

4. Bank of America (NYSE: BAC), Fifth Third (Nasdaq: FITB) and Regions Financial (NYSE: RF) each did equity offerings this week. BofA priced 825 million shares at $10/share on Tuesday night, Fifth Third announced a $750 million at-the-market offering and Regions priced 400 million shares at $4 on Thursday.

5. Shares of General Motors (NYSE: GM) traded extremely wildly this week as bankruptcy looms, drawing nearer and nearer each day. The stock rallied 76% from Monday to Thursday as traders hope that the company could reach a tenative agreement with the UAW. Also adding to upside, GM announced that it has received offers from 4 bidders for its Opel unit. On Friday, however, President Obama made comments suggesting that he would place the automaker into bankruptcy as early as next week. The stock closed this week up 31%.

6. Given concerns related to the S&P's Negative outlook on the U.K., the U.S. dollar struggled this week while gold soared. Smart money, like Paulson & Co.'s John Paulson, made big bets on the commodity.

7. Stocks worldwide spiked on Monday following election results out of India. As the democratic nominee won, the news was a boon to markets everywhere.

8. The U.S. Senate passed sweeping legistlation on Tuesday tightening restrictions on the entire credit card industry. Among several of the initiatives, credit card companies will no longer be able to raise rates on existing card balances unless the cardholder is 60 days late on a payment. Also, after the conumer has made 6 months of on-time payments, the credit card issuer would be forced to restore the prior, lower interest rate. A 45-day notice for interest rate increases will also be enacted.

9. Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS) and JPMorgan (NYSE: JPM) were all reported to be in line to repay their TARP funds this week. The buyback, however, will not be confirmed until June when the Fed responds to these repayment requests.

10. AIG's (NYSE: AIG) short-time CEO, Ed Liddy, annouced he would be stepping down from his position once the Board has found a replacement for him. Morevoer, Liddy also recommended that the Board seperate the Chairman and CEO roles.

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JPMorgan, Goldman Sachs, William H. Gross, Pacific Investment Management Company, LLC (PIMCO), Morgan Stanley, Paulson & Co. (PCI), Standard & Poor's, Top 10 News Items for the Week, Bankruptcy, FDIC, Barack Obama