The broad index ended with slight declines, after the U.S. Commerce Department said that despite a slight increase in disposable consumer income during October, consumer spending was down 0.2%. The Commerce Department's Bureau of Economic Analysis said that "the October estimates of personal income and outlays reflect the effects of Hurricane Sandy, which made landfall in the United States on October 29," and while it "cannot quantify the total impact of the storm on personal income and outlays," the Bureau "did make adjustments where source data were not yet available or did not reflect the effects of Sandy."
Meanwhile, the impasse over the fiscal cliff continued, following U.S. Treasury Secretary Timothy Geithner's presentation on Thursday to of a compromise package to Speaker of the House John Boehner (R-Ohio), that included the tax increases for couples earning over $250,000 a year favored by President Obama, along with a new $50 billion stimulus spending package, while not offering the type of spending cuts that Republicans are looking for.
Boehner said to reporters on Friday "there is a stalemate. Let's not kid ourselves," and that raising taxes on the highest earners would be a "crippling blow" to small businesses, according to various reports.The KBW Bank Index (I:BKX) was down slightly to close at 48.54, with 15 of the 24 index components ending the week with declines.
Cost Cutting at Citigroup
Citigroup's shares have now returned 32% year-to-date, following a 44% decline during 2011. The shares trade for 0.7 times their reported Sept. 30 tangible book value of $52.70, and for 7.5 times the consensus 2013 EPS estimate of $4.64, among analysts polled by Thomson Reuters. The consensus 2014 EPS estimate is $5.04. After Bloomberg on Thursday reported that Citigroup was planning to cut 150 additional investment bank jobs in the fourth quarter, after laying off 1,550 investment banking employees earlier this year, Nomura analyst Glenn Schorr on Friday suggested that the company could benefit from a "named" cost savings program.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV