Leaders of the U.S. bank Goldman Sachs made an attempt to protect the Tuesday before the committee of the American Congress, who accuse them of having contributed to the formation of a bubble in the real market and generated billions of financial institution gains on the back of her customers. During the hearing, representatives of the bank said it has been practiced classical risk management and is betting that a global decline in the real estate market, Reuters reported. Fabrice Toure, the French officer of Goldman, accused the creation of complex financial products, which focus on investigations initiated the Securities and Exchange Commission, said that there was no hiding important information from their customers. Beam live video of the hearing made investors witnessed the lively discussions and exchanged fierce lines. For example, Senator Carl Levin, chairman of the meeting, asked Dan Sparks, a former director of mortgage lending at Goldman, if he felt a need to inform their customers where Bachelor is betting against their positions. Sparks did not answer directly on this issue and stated that it would use the definition of “shitty deal”, according to which the Committee has used one of his bosses on the part of the activities of the bank.
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For the second day this week, U.S. indexes continued to climb, as higher oil prices helped the good performance of companies in the energy sector. Good financial results of Goldman Sachs, Johnson & Johnson and Coca-Cola have also contributed to the optimism of investors. Dow Jones Industrial Average rose 0.2 percent to 11 117 points, 20 of 30 stocks closed in the composition of the green, led by oil company Exxon Mobil, whose shares rose 1.16 percent. Shares of two other companies in the Dow Jones IA – Coca-Cola and IBM, have lost their positions despite the good financial results for the quarter. Shares of Coca-Cola dropped by 0.1 percent after the largest soft drink producer in the world announced weaker than expected sales growth in the U.S. Higher than forecast profits of IBM, announced before the start of the session, failed to offset disappointing gross profit margin and the company’s shares lost 0.3 percent of the price. S & P 500 added 0.8 percent to 1 207.17 points, as energy companies were among the most profitable, supported by oil, which closed nearly 1 percent growth level of 83.85 dollars a barrel.
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The Britain’s Prime Minister Gordon Brown attacked the U.S. bank Goldman Sachs, stating that it was “morally bankrupt”. The reason for criticism of the financial institution provide the prosecution that she manipulations financial markets. Brown, who is fighting for a new mandate at the head of the British government, asked Britain’s financial regulators to conduct their own investigation of the banking sector. “Banks are still a problem. They are a risk to the economy, citing Prime Minister, quoted by FT. German authorities also announced they will begin their own investigation of the case and eventually will take legal action against Goldman. This gives rise to failure of the German IKB Bank in 2007 as a financial institution became one of the first victims of the crisis. Goldman Sachs will certainly be in focus throughout the week because after the failure of the bank’s shares by almost 13 per cent on Friday will be interesting how they will continue to trade with them.
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The last session this week brought strong decreases in the three major indexes on Wall Street in the range of 1.1% to 1.6%, although two of the companies in the Dow Jones – Bank of America and General Electric, announced better than expected profit for the first three months of this year. The news that investment bank Goldman Sachs is accused of fraud by mortgage securities, shocked Wall Street and overshadowed the good data on housing in the U.S. in March. The index of 30 largest stock exchange and frequently traded companies Dow Jones IA fell 1.1 percent, or 126 points to 11 018.66 points. The broad measure of stock S & P 500 lost 1.6 percent to 1 192.13 points while the index of companies by the exchange Nasdaq – Nasdaq Composite, fell 1.4 percent to 2 481.26 points. Session on Thursday brought minor changes to the index after three disappointing news for initial unemployment and industrial production. Shares of industrial conglomerate General Electric dropped by 2.7 percent to 18.97 dollars on the New York Stock Exchange after the company reported 18 percent drop in profit for the first quarter to 2.3 billion dollars, or 21 cents a share. Analysts had expected a smaller profit per share of 16 cents. The largest U.S. bank Bank of America, in turn, said it issued a profit of 3.2 billion dollars for the first three months of the year, or 28 cents a share. This was three times more than market forecasts, but shares in the bank fell by as much as 5.5 percent to 18.41 dollars on the New York Stock Exchange.
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Goldman Sachs is best managed company in the U.S. financial sector, says banking analyst at Rochdale Securities Richard Bouv. However, the most promising and undervalued share in the sector is that of Citigroup, is confident the specialist. According to him, Citigroup shares have the potential to reach a price of $ 20 per piece, which means that within 2-3 years it has risen to four. Yesterday the bank’s shares lost 5 percent of its value to 4.75 per dollar. The reason for this report gave the financial institution, which showed a profit of 101 million dollars. “It’s more than Goldman Sachs can bring to investors, although the company is much better,” said Bouv. Shares of Goldman Sachs fell by 1,9 per cent yesterday and closed trading session at 188.63 dollars cash. This happened despite the strong statements of the company and reported profit growth of 300 percent on an annual basis. Richard Bouv leveled criticism at those who launched sales of the shares of Goldman since the publication of quarterly results. They greatly exceeded forecasts of analysts, but many were left disappointed as expected surprisingly high performance.
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U.S. indexes rose on Thursday as energy shares rose, influenced by the price of oil, which climbed to their highest level of a year. This helped to give the movement indexes from the first hours after the opening of the session when the market was under the influence of the results of Citigroup and Goldman Sachs, which disappointed investors. The indexes went up to a new annual peak. The index of the 30 most liquid stock companies Dow Jones IA added to the 0.5 percent to 10,062.94 points, after the previous session passed the psychological limit of 10000 points. The wider S & P 500 climbed 0.4 percent to 1096.94 points and the index of companies in the Nasdaq stock exchange ended with a growth of 0.1 percent to 2173.29 points. Shares of Exxon Mobil and Chevron Corp. by adding 1.5% to its value after oil jumped more than 77 dollars a barrel. Citigroup dropped by 5 percent, while Goldman Sachs fell by 1.9 percent. Weakness in financial shares dominated the beginning of the session when the Dow Jones IA down again than 10000 points. The data published by the Ministry of Energy of the United States, which showed that reserves of gasoline fell unexpectedly, caused sharp increases in oil prices, which sparked and interest in the oil companies and turn the market.
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American stocks started the week in positive territory after having registered two consecutive weeks of decreases. Strong support indices proved data services sector in the United States and the recommendations of Goldman Sachs Group Inc. purchase of major U.S. banks. ISM index in the service sector rose to 50.9 in September from 48.4 in August, data above 50 indicate activation of the sector. The services sector in the United States represents more than 80% of economic activity in the country and was an improvement from August 2008. With the launch of the new quarter, investors began to focus on individual corporate performance. First reports will begin with aluminum giant Alcoa on Wednesday as expectations of analysts the company reported nine consecutive quarterly loss.
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