BofA, Citi: Wednesday's Headlines

(Updated with Monsanto earnings, Microsoft Windows 7 news.)

NEW YORK (TheStreet) -- Here are the top stock market headlines for the morning of Wednesday, Oct. 7, 2009.

Wednesday's Early Headlines

• BofA CEO Search Down to Two: Report -- The Wall Street Journal reports that Bank of America's (BAC) search for a new CEO has narrowed to two internal candidates, Chief Risk Officer Gregory Curl and Brian Moynihan, BofA's consumer and small-business banking chief. The report added that the bank's board is still keeping its eyes open for a new chief outside the company.
• U.S. Banks Slow to Take Commercial Real-Estate Losses -- The Wall Street Journal reports that a leaked Federal Reserve presentation shows that U.S. banks are slow to take losses on their commercial real-estate loans. "Banks will be slow to recognize the severity of the loss -- just as they were in residential," according to the Fed presentation, which was reviewed by the Journal.
• Fed Should Tighten Rates Sooner Rather Than Later: Hoenig -- Bloomberg reports that Kansas City Fed President Thomas Hoenig said the central bank should start raising interest rates "sooner rather than later," and such tightening wouldn't derail the U.S. economic recovery. "Even if we were to start immediately, much time would pass before incremental increases could be considered tight or even neutral policy," Hoenig said yesterday in a speech in Denver, according to the report.
• Banco Santander Raises $8.1 Billion With IPO -- Banco Santander (STD) raised 14.1 billion reals ($8.1 billion) in the initial public offering of its Brazilian operations. The Brazilian unit sold 600 million shares for 23.50 reals ($13.43) apiece, in what is the biggest initial public offering this year. The price was in the middle of the expected range of 22 reals to 25 reals.
• Citi Reportedly Leaning Towards Phibro Sale -- The Financial Times reports that Citigroup (C) is leaning toward selling its energy-trading unit Phibro to raise money and deflect political anger over a potential $100 million payout to Phibro's star trader Andrew Hall. The decision by the bank to completely divest itself of the division followed debates on whether it should divest just part of the unit, open it up to outside investors or spin it off, the report notes.
• Gold Futures Set Another New All-Time High -- Inflation fears continue to push gold higher Wednesday, as gold for December delivery rose to $1,048.80 an ounce in electronic trading, setting a new intraday high.

Technical Analysis: Gold


• Energy Department to Release Weekly Inventory Data -- The Energy Department's weekly inventory report, due at 10:30 a.m. EDT, should show that crude oil inventories rose by 2 million barrels last week, according to a Bloomberg survey of analysts. Crude oil was lately up 33 cents to $71.21 a barrel.
• Ballmer Sees Muted Windows 7 Effect -- Reuters reports that Microsoft (MSFT) CEO Steve Ballmer told a group of journalists in Munich that he expects the new Windows 7 operating system to increase demand for personal computers only slightly.

Wednesday's Earnings Roundup

• Costco Wholesale (COST) said fiscal fourth-quarter earnings were $374 million, or 85 cents a share, down from a year earlier but ahead of analysts' expectations as sales fell 3%. Net sales in the quarter were $21.89 billion, down from $22.63 billion a year earlier. Analysts expected Costco to report fourth-quarter earnings of 77 cents a share on revenue of $22.33 billion, according to Thomson Reuters.
• Family Dollar (FDO) reported fiscal fourth-quarter earnings rose to $60.1 million, or 43 cents a share, from a year-ago profit of $53.2 million, or 38 cents a share. Net sales rose 2.6% from a year ago to $1.81 billion. Analysts were looking for a profit of 41 cents a share on sales of $1.81 billion. Family Dollar also offered in-line guidance for the company's fiscal first quarter as well as the full year.
• Monsanto (MON) reported a fiscal fourth-quarter loss of $233 million, or 43 cents a share, swelling from a year-ago loss of $172 million, or 31 cents. Adjusted earnings of 2 cents a share topped the Thomson Reuters average estimate of a penny a share.