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Wells Fargo & Company (NYSE:WFC): The “junk” bond boom has created concern with a few large money managers, warning that the market has signs of overheating, according to the Wall Street Journal. In the past year, investors put a record $34B into junk-bond mutual funds through September. Because of this, weaker companies now have the ability to sell bonds, and the credit ratings of a great deal of borrowers are lower and debt levels are higher, making defaults more probable. As yields close in on record lows, the managers say, investors will not be compensated for that risk.
Bank of America (NYSE:BAC): U.S. stocks saw a quick rise, with the Standard & Poor’s 500 Index reaching its first weekly gain in three, as a surprise drop in the American unemployment rate created confidence in the world’s largest economy. Bank of America Corp. and Citigroup Inc. saw a boost of at least 1.3 percent to lead advances among financial shares.
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Apple Inc. (NASDAQ:AAPL): A year after following Steve Jobs’s passing, Apple has released a sentimental tribute to the former CEO. Job passed away on Oct. 5, 2011, after a lengthy battle with cancer. Jobs fought the cancer in 2004 and had a liver transplant during 2009 after he took leave of absence due to undisclosed health issues.
Facebook, Inc. (NASDAQ:FB) is looking toward Russia and has begun trying to draft geeks to build apps for the company’s home market. The company is attempting to win over users as it competes with local rivals like VKontakte and Odnoklassniki, which together attract 10 times more traffic, according to Bloomberg. There are 3.5 million daily Facebook users versus VKontakte’s 22 million users and Odnoklassniki’s 16 million, according to data by TNS Global. During the week, CEO Mark Zuckerberg hosted nearly 200 developers in Moscow as he attempts to create apps meant to get people to sign up and log in daily.
AT&T, Inc. (NYSE:T) announced that its growing 4G LTE smartphone portfolio, and it will introduce three new devices from HTC® – the HTC One™ X+, HTC One VX, and the Windows® Phone 8X by HTC. Powered by the nation’s largest 4G network, All three HTC devices have the ability to access the AT&T 4G LTE network, and they have enhanced audio and video features, which makes it easier and faster for customers to be both connected and entertained.
Afternoon Buzzers: Apple Pays Tribute to Steve Jobs, Zynga Plunges 19%
Shares of Apple (NASDAQ:AAPL) traded slightly lower in morning trading. The tech giant is remembering its co-founder Steve Jobs, who passed away one year-ago today, with a tribute video on its website. Current Apple CEO Tim Cook also posted a message that says, “One of the greatest gifts Steve gave the world is Apple. No company has ever inspired such creativity or set such high standards for itself.”
Zynga (NASDAQ:ZNGA) shares plunged nearly 19 percent. Although Zynga already cut its full-year guidance once before in July, the company reduced its outlook for the year even more. Bookings are projected to be in the range of $1.085 billion to $1.100 billion, compared to previous expectations between $1.150 billion and $1.225 billion. Adjusted EBITDA is estimated to come in at $147 million to $162 million, down from the previous $180 million to $250 million range. Facebook (NASDAQ:FB) shares also declined on the news.
Avon Products (NYSE:AVP) shares jumped 5.5 percent on Friday. The company announced that Andrea Jung has informed the Board of Directors that she will step down as executive chairman at the end of the year. She will be succeeded by Fred Hassan, the lead independent director. “Fred’s experience and leadership on the Avon board, and his unusual record of leading turnarounds at world-class companies over his distinguished career make him ideally suited to take on the independent chairman role,” said Jung.
Shares of Hewlett-Packard (NYSE:HPQ) continued to head lower. Meg Whitman, chief executive officer, recently said she expects the coming fiscal year to be another difficult one for the technology company, saying HP will experience a “broad-based profit decline.” The company projected revenue at its enterprise services to drop about 11 percent to 13 percent, and estimates earnings of $3.40 to $3.60 per share. On Thursday, Whitman told CNBC that rebuilding the company is a four or five year plan.
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First Solar, Inc. (NASDAQ:FSLR): Rising manufacturing capacity of solar panels and wind turbines in China has made a large oversupply and a possible financial crisis for manufacturers and state-owned banks, according to the New York Times. China’s most prominent solar panel makers have faced losses of as much as $1 for every $3 of sales during the year.
Lions Gate Entertainment Corp. (NYSE:LGF): Brian Goldsmith was named co-COO of the company. Goldsmith joins co-COO Steve Beeks, and they will report to Lionsgate CEO Jon Feltheimer regarding corporate management issues. The two will also keep working closely with Vice Chairman Michael Burns and General Counsel Wayne Levin on M&A activities and initiatives concerning Lions Gate’s capital structure, which includes significant corporate and project financings. Goldsmith was a main player in the arrangement of Lionsgate’s recently closed $800 million revolving credit facility along with the company’s October 2011 secondary equity offering and its two high yield debt offerings. He was instrumental in the company’s January 2012 acquisition of Summit Entertainment, which is the August 2011 sale of Canadian distributor Maple Pictures to Alliance Films and the February 2009 acquisition of TV Guide Network and TVGuide.com. Additonally, he was also a key player in overseeing Lionsgate’s partnerships with Viacom and MGM in the Epix channel, Sony ,and Comcast in the FEARnet Channel and the launch of Celestial Tiger Entertainment in Asia with partners Saban Capital Group and Astro’s Celestial Pictures. Goldsmith was EVP of Corporate Development and Strategy since September 2008, and he was responsible for leading the company’s acquisition and corporate development activities.
Caterpillar Inc. (NYSE:CAT) Q2 report shows decreasing Chinese sales, after enjoying solid growth in North America. Caterpillar’s report stated that China’s construction market was weak, and the company was forced to cut output and reduce inventory, despite its expectations of a better second half of the year. It made the decision to set up a plant in Texas that makes hydraulic excavators, assisted by a $14.3-million government grant.
Avon Products Inc. (NYSE:AVP) announced that Andrea Jung told the board her intentions to resign as Executive Chairman and Board member, beginning on December 31 after the successful transition to new leadership under CEO Sheri McCoy. Jung intends to keep serving as a senior adviser to the Board starting January 1, 2013.
Constellation Brands Inc. (NYSE:STZ) reports its Q2 revenue at $699 million, consensus $710.09 million.
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Wall Street Brief: Samsung to Beat Forecasts, Zynga Sell-Off Continues
Samsung (SSNLF.PK) anticipates its third quarter earnings will exceed forecasts as its operating profit increased 91 percent to a record 8.1 trillion won ($7.09 billion) and sales rose to 51 trillion-53 trillion won, up from 41.27 trillion won in the previous year. Earnings jumped thanks to Samsung’s mobile phone division, whose profit likely doubled to 5 trillion won as smartphone shipments moved passed 58 million. High-end TVs also saw strong sales.
Sprint’s (NYSE:S) board has scheduled a noon phone meeting on Friday and will talk about potentially renewing its pursuit of MetroPCS (NYSE:PCS), reported The Wall Street Journal. In February, the board had rejected what appeared as a done deal for MetroPCS. Sprint’s stock was only $2 a share, but after rallying to $5, movement on its the network upgrade, and its iPhone (NASDAQ:AAPL) investment reaping benefits, directors may now be singing a different tune.
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Zynga (NASDAQ:ZNGA) shares are off more than 17 percent after warning on Thursday that it expected 2012 bookings of $1.085 billion-$1.1 billion, coming in on its previously cut $1.15 billion-$1.225 billion guidance. The company also sees third quarter revenue of $300 million-$305 million higher than estimates but forecast that bookings will come to $250 million-$255 million. Zynga attributed the lower numbers to a weakness in its web games “invest and express” category such as FarmVille and CityVille.
The Senkaku-Diaoyu islands dispute between Japan and China affected Japanese car makers in September, with Mitsubishi’s Chinese sales plummeting 63 percent on the year while Mazda (MZDAF.PK) fell 35 percent and Toyota’s (NYSE:TM) sales dropped 40 percent reported the Financial Times. In addition, Toyota will slash production in China by more than half and postpone exports of the Lexus.
Cisco (NASDAQ:CSCO) is shaking up its management; worldwide sales chief Rob Lloyd will take over as President and head of development and sales. COO Gary Moore being has also been named a president while Americas sales chief Chuck Robbins takes over Lloyd’s previous role. The moves come after CEO John Chambers previously said he may retire in two to four years, and named Moore, Lloyd, and Robbins (among others) as possible successors.
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