In the next few days the U.S. Treasury will ask the companies that received large government loans to seriously reduce salaries of senior employees. According to a source of authoritative agency media agency reduction in basic pay for the most expensive employees, will be up to 90%, while compensation and bonuses will be cut in half. It is unclear exactly what will be the ceiling on wages and how they will be calculated. The reductions apply to 25 of the most high paid executive directors in seven large U.S. financial companies. In them are American International Group, Bank of America, Citigroup, General Motors, GMAC, Chrysler LLC and Chrysler Financial. Smaller companies and those who have already returned to government loans in the financial plan of George Bush (TARP) as Goldman Sachs and JPMorgan Chase, will not be affected by the measure. Among other things, any financial limit for the targeted companies will mean that executives will have to ask permission for any special privileges worth over 25 thousand dollars – a private plane at a club membership and service cars.
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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 are traded in the Range near at its highest levels for the year. Retention of the upturn came after depreciated on the basis of profits that disappointed investors. Citigroup was down by 5.4 percent to 4.73 dollars. Bank from which the U.S. government owns 34%, has 101 million profit for the third quarter. For its part, Goldman Sachs fell 2.39 percent to 187.65 dollars. The Bank reported a profit for the third quarter amounted to 3.19 billion dollars, thanks to better management of personal assets. However, the bank does not meet the expectations of analysts. JPMorgan lost 0.7 percent to 46.82 dollars, while Bank of America fell by 3.3 percent to 17.98 dollars. Capital One Financial Corp. also decreased by 4.7 percent to 37.5 dollars. Positive news from the labor market in the U.S. also could not help the market to continue its strong upward trend. Applications for unemployment benefits fell to 514 thousand in the last week at 524 thousand a week earlier. Long-term unemployed also fell to below 6 million USD. Energy companies were traded in positive territory, with Chevron Corp. rose 1.4 percent to 76.5 dollars, and Exxon Mobile added 1.32 percent to 72.79 dollars after oil futures rose above $ 78 a barrel. Ministry of Energy of the United States reported an unexpected drop in gasoline stocks due to closure of refining capacity for technical review.
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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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