Updated with stock price moves
NEW YORK (
shares were among the losers of the financial sector Tuesday after an analyst cut earnings estimates for the bank's fourth quarter on decelerating trading activity.
Bank of America/Merrill Lynch analyst Guy Moszkowski cut his fourth-quarter earnings estimate for JPMorgan Chase to 68 cents a share from 71 cents a share, citing seasonal trading deceleration that started in November and has continued through quarter end. Still, that is still above the Thomson Reuters consensus target of 63 cents a share.
As a result, Moszkowski now expects JPMorgan to post a full-year profit of $2.20 a share, down from his previous target of $2.24 a share but above the average analyst target of $2.14 a share.
Moszkowski also reduced his fourth-quarter earnings targets for
to $5.74 and 40 cents a share from $6.57 and 47 cents a share, respectively, on recent weak trading statistics. Goldman is expected, on average, to record a fourth-quarter profit of $5.56 a share. Moszkowski's new target for Morgan's fourth-quarter earnings, though, is below the Thomson Reuters average estimate of 54 cents a share.
The estimate for
fourth-quarter loss was left unchanged at 36 cents a share, which Moszkowski says is largely due to a large share base.
news, the bank could nix plans to build its European headquarters in London if a 50% tax on banker bonus is imposed, according to reports.
JPMorgan Chase CEO Jamie Dimon reportedly told U.K. Chancellor of the Exchequer Alistair Darling in a phone call that a 50% tax on banker bonuses would unfairly penalize the U.S. bank. Reports say the bank was considering dropping its plans to build its European headquarters at Canary Wharf in London because of the tax.
The Financial Times
, quoting a senior JPMorgan executive, reports the bonus tax will be a factor in the decision.
was also making headlines on reports it may overhaul the way it pays its top executives, deferring more of their compensation over time and benchmarking their pay against rival firms.
The Wall Street Journal
, citing people familiar with the matter, reports that Morgan might not go as far as rival Goldman, which said its top executives would receive only stock for 2009 bonuses.
JPMorgan Chase shares were lately down 0.1% to $41.67, while Morgan Stanley reversed early losses to climb 0.8% to $29.52. Citigroup dipped 0.6% to $3.37. Goldman Sachs shares gaining 0.7% to $164.92.
Among other bank stocks,
Bank of America
slid 1% to $15.14,
gave back 0.5% to $26.62,
was down 0.3% to $15.74, and
slipped 0.6% to $57.04.
American International Group
plans to pay outgoing general counsel Anastasia Kelly several million dollars in severance after she resigned over federal pay curbs, according to a report in
The Wall Street Journal
determined that Kelly was entitled to the money under the company's severance plan, whose terms say certain executives can resign and collect severance if their pay is reduced significantly, the paper reported, citing people familiar with the matter.
AIG shares were climbing 0.7% to $31.71.
gave up early gains and retraced some of the recent rally sparked by the Treasury Department's decision to remove a cap on aid for the government-sponsored enterprises.
On Thursday, the Treasury removed the $400 billion financial cap on the money it will provide to both Fannie and Freddie. The Treasury also said it will not require either to reduce the size of their mortgage-related investment portfolios next year, as previously planned.
Fannie Mae shares were lately down 0.8% to $1.26, although the stock is still up more than 20% this week. Freddie Mac was losing 3.1% to $1.55, and is now up 23% since the Treasury's announcement.
-- Written by Robert Holmes in Boston
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