Afternoon Roundup: Today's Top Stories
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With the heightened European crisis and fear lingering over investors, banks expect their third-quarter earnings to fall sharply. JPMorgan Chase (NYS: JPM) warned investors they might see a drop of 8% in trading revenue. Investment banking income may fall by a third compared to last year as corporations second-guess expansions and stock offerings. Even though trading revenue was what helped lift banks after the crisis, that same revenue is expected to drop by 7% industrywide compared to last year. With gloomy days ahead, banks have been tightening their belts, like Bank of America (NYS: BAC) cutting about 30,000 jobs over the next three years. Citigroup (NYS: C) and Morgan Stanley (NYS: MS) are also expected to suffer from the weak economic market. Citigroup could see as much as a 47% drop in its core trading business while Morgan Stanley may see only a 1% drop. Read more atThe New York Times.
(NAS: RIMM) , which reports earnings Thursday, may not have made the mark on the number of PlayBooks shipped. For every 19 iPads sold and shipped, only one PlayBook did the same, according to Bloomberg estimates. RIM needed strong sales for its tablet to offset lower demand for its smartphones. The PlayBook, which was seen as a product with potential to become a new category, was released a year after the first iPad and behind competitors like Samsung. RIM has had a rough year with its lower sales, while Google (NAS: GOOG) takes its smartphone market share with its Android operating system. RIM also announced it would cut 2,000 jobs, or a tenth of its workforce. Read more atBloomberg.
(NYS: PEP) announced a management shakeup in its drinks division. The changes include the departure of bottling chief Eric Foss and the demotion of Massimo D'Amore, who ran the Americas beverage group. The company said the two positions would be essentially combined and be filled by Albert Carey, a 30-year Pepsi veteran who most recently ran the Frito Lay division for North America. The shakeup was expected after Pepsi acquired the bottling unit. The stock was up about 0.6%. Read more atReuters.
Retail sales stayed flat for the month of August, giving more evidence that consumers have not regained their confidence. According to the Department of Commerce, retail and food-services remained stalled at an adjusted $389.5 billion. The data come as unemployment remains at 9.1% and poverty in the country reached its highest point in 17 years. Inflation remained the same level. The factors will allow the Federal Reserve to implement credit-easing measures to stimulate the economy in the upcoming weeks. Read more atThe Wall Street Journal.
So there you have it, the top financial stories for this afternoon. If you are interested in getting all the news and commentary on these stocks, sign up to My Watchlist here it's free!
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At the time this article was published Michelle Zayed doesn't own any stocks mentioned. The Motley Fool owns shares of Citigroup, JPMorgan Chase, Bank of America, Google, Research In Motion, and PepsiCo.Motley Fool newsletter serviceshave recommended buying shares of PepsiCo and Google.Motley Fool newsletter serviceshave recommended creating a diagonal call position in PepsiCo. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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