Citigroup's CEO resigns, stock market rebounds on earnings, retail sales reports. Learn more about these and other top business stories of the day.
Citigroup CEO Resigns
Vikram Pandit is resignign as CEO of Citigroup, the Associated Press reports. Pandit steps down after steering the bank through the 2008 economic collapse. Michael Corbat, the current CEO of Citigroup's Europe, Middle East and Africa division, will be his replacement. The company's Chief Operating Officer John P. Haven is also stepping down, the company announced Tuesday in a press release. No explanation for the changes has been offered.
U.S. Stocks Rebound
Better-than-expected September retail sales helped fueled a rally in U.S. stock markets yesterday, Reuters reports. The Standard and Poor’s 500 Index bounced back from a four-month low to close at 1,440.13. The Dow Jones Industrial Average gained .71 percent to close at 13,424.12, and the Nasdaq Composite rose 0.66 percent to close at 3,064.18.
Investors also responded positively to the third-quarter earnings report from Citigroup, which beat analysts’ expectations. Citi share rose 5.5 percent, and shares for Bank of America, JP Morgan and Goldman Sachs also went higher, according to CNN Money.
Wall Street Strategists: S&P May Hit 1,575 in 2013
Goldman Sachs yesterday joined four other Wall Street firms in forecasting the Standard & Poor’s 500 Index will achieve a new record next year, Bloomberg News reports.
Wall Street strategists predict the index could climb as high as 1,575, beating the index record of 1,565.15 achieved on Oct. 9, 2007, according to Bloomberg. Goldman joins the Bank of Montreal, Bank of America Corp., Citigroup Inc. and Oppenheimer & Co. in predicting a new high for the benchmark index.
The predictions are based on the belief that stimulus provided by QE3 will provide long-term support, though the index may slump toward the end of the year due to the short-term political risk surrounding the fiscal cliff, Bloomberg reports.
‘Walking Dead’ no Sleeper
The premiere of season three of “The Walking Dead” attracted 10.9 million views for its initial airing at 9 p.m. on Sunday, besting all other entertainment shows on every other broadcast network, The New York Times reports. Another 3.5 million viewers watched the repeat at 10 p.m., and 850,000 more saw the show at midnight. The numbers do not reflect delayed viewing of recorded shows.
The AMC drama was topped by NFL football on NBC and possibly “60 Minutes” on CBS. The show attracted 7.3 million viewers between the ages of 18 and 49, a demographic prized by advertisers. “The Walking Dead” has also attracted more viewers than “Modern Family,” “The Big Bang Theory” and “The Voice,” and now tops all dramas in the history of basic cable television.
Sprint Rings up a Buyer
Japanese mobile operator Softbank Corp. said it will buy about 70 percent of Sprint Nextel Corp for $20.1 billion, Reuters reports. Announced Monday at a press conference in Tokyo, the deal for the third-largest U.S. wireless carrier represents the most a Japanese firm has spent on an overseas acquisition and affords Sprint the capital to expand its network and potentially buy peers, as well as build out its 4G network to compete with AT&T and Verizon Wireless. The transactions are to be completed by mid-2013, at which point New Sprint will be a publicly traded company and the old Sprint will survive as its subsidiary, Reuters notes. Banks including Citigroup Inc. and Raine Group LLC may earn as much as $200 million working on the transaction, Businessweek reports.
U.S. Retail Sales Rise in September
The U.S. Commerce Department reported a better than expected 1.1 percent increase in retail sales during September. Consumer spending accounts for 70 percent of the economy. The reading follows a drop in the unemployment rate and a reported rise in consumer confidence. Sales outside autos, gasoline and building materials climbed 0.9 percent last month, while sales at electronics retailers advanced 4.5 percent. However, this may be due to demand for Apple’s new iPhone. Sales at food and beverage stores climbed 1.2 percent, which might reflect some of the increase in food prices due to a recent drought, while a 2.5 percent increase in gas station receipts may also reflect a rise in prices.
Four States’ College Plans Make the Grade
College savings plans offered through the states of Alaska, Maryland, Nevada and Utah earned top marks from Chicago-based Morningstar Inc. in the company's annual update to ratings of so-called 529 plans, the Associated Press reports. The four are: Alaska's T. Rowe Price College Savings Plan, managed by T. Rowe Price, Maryland College Investment Plan, also run by T. Rowe Price, Nevada's The Vanguard 529 Savings Plan, managed by Upromise Investments Inc., and Utah Educational Savings Plan, managed by the agency of the same name. Four plans received silver-medal ratings, including two that moved down to the second-tier group after winning top marks last year. Those two are Ohio's CollegeAdvantage 529 Savings Plan, managed by the Ohio Tuition Trust Authority, and Virginia's CollegeAmerica, managed by American Funds.