NEW YORK ( TheStreet) -- Citigroup (C) was the big winner among the largest U.S. financial names on Wednesday, with shares rising over 6% to close at $36.46, after the company announced a major initiative to cut expenses and narrow its focus.
Dow Jones Industrial Average
One of the worst performers on Thursday was Freeport-McMoRan Copper & Gold (FCX) which tumbled another 4% to close at $30.81 after a 16% drop on Wednesday, which followed the company's announcement of two pricey acquisitions.
Freeport-McMoRan agreed to pay $6.9 billion in cash and stock to acquire Plains Exploration & Production Co. (PXP), and $2.1 billion to acquire the 64% of McMoRan Exploration (MMR) that it doesn't already hold. The $50 per share valuation for PXP represented a 39% premium over the oil driller's closing price of $36.05 on Tuesday. The $14.75 per share cash consideration for McMoRan Exploration was a 74% premium to that firm's closing price of $8.46.Jim Cramer said that the Freeport-McMoRan didn't pass the " smell test," as the company and McMoRan Exploration are both chaired by James Moffett, and MMR "become a free-falling stock of late courtesy the missteps" in a large drilling project in the Gulf of Mexico. Cramer also said that the two acquisitions were "hardly arms-length deals," as Plains Exploration "owns 31.5% of McMoRan and Plains' CEO, Jim Flores, is on the board of McMoRan." With so many questions concerning the deals, it was hardly surprising to see the stocks of all three companies decline. Shares of Plains Exploration were down 3% to close at $43.18, while McMoRan Exploration was down 5%, closing at $15.02. Turning back to financials, the KBW Bank Index (I:BKX) rose slightly to close at 48.78, after the Labor Department said that initial unemployment claims for the week ended Dec. 1 fell 25,000 to 370,000, coming in lower than the consensus estimate of 380,000 among economists, according to Briefing.com. The prior week's claims were revised upward to 395,000. Continuing jobless claims for the week ended Nov. 24 fell by 100,000 to 3.21 million from the preceding week's upwardly-revised level of 3.305 million.
BB&T's shares have now returned 15% year-to-date, following a 2% decline during 2011.
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