(Uptdated from 11:39 a.m. EDT)
Company news poured in Monday after a week's hiatus from stock trading. Most of it was lowered earnings guidance and stock repurchases.
closed down 49.42% to $20.05 on concerns flight cancellations and increased security following the Sept. 11 attack could cut deep into airline profits and even force some bankruptcies. Continental announced this morning it will miss $70 million in debt payments. The company has five to 10 business days starting Monday to make the payments, before it goes into default under its financing agreements. On Saturday, Continental said it will lay off about 12,000 employees.
Other airline stocks also fell sharply.
lost 52.07% to $5.57. United Airlines' parent
fell 43.22% to $17.50. American Airlines parent
ended off 39.39% to $18 and
finished 44.59% lower to $20.64
Monday said fourth-quarter earnings would miss analyst targets due to bleaker business prospects for the airline industry. The maker of aerospace parts, engines and elevators said fourth quarter and full-year earnings would fall 30 cents a share below Wall Street expectations. Third-quarter earnings met previous estimates, the company said. United Technologies shares finished the day down 28.25% to $47.50
lost 6.71% to $39.60 after the company lowered its third-quarter earnings estimate, citing insurance claims related to the World Trade Center disaster, and revenue losses due to subsequent bank and stock exchange closures.
The No. 1 financial services firm in the U.S., Citigroup said it expects to pay out $500 million after tax in property, business interruption, workers compensation and life insurance claims. Closure of the New York Stock Exchange and temporary closures of some of its branches would cut earnings by a further $100 million to $200 million after tax, Citigroup said.
Several insurers gave estimates on losses they expected to sustain as a result of World Trade Center-related claims. The industry as a whole expects it will have to make as much as $30 billion in claims payments for the terrorist attacks, Bloomberg reported.
American International Group
, which said losses could total $500 million, fell 4.39% to $71.
said it expected profits to drop $700 million as a result of the attacks, and finished the session 12.67% lower to $71.61.
slashed its third-quarter profit expectations by $400 million, and shares dropped 13.61% on the day to $28.51.
Shares of industrial giant
lost 10.67% to $35.15 today, despite news released this morning that the company plans to accelerate its stock buyback program.
Over 75 companies have announced plans to buy back their own shares following last week's attacks in New York and Washington, according to Reuters. The Securities and Exchange Commission loosened rules regulating the size and timing of such programs following the attacks.
Companies announcing buybacks include insurer AIG, media giant
, soft drink bottler
and computer heavyweights
. Of those listed, only Pepsi finished higher, up 2.13% to $47.90.
Federated Department Stores
said Monday sales fell last week due to the U.S. terror attacks. Federated, the parent of Macy's and Bloomingdale's, said its sales in the week ended Sept. 15 were about $65 million below company forecasts due to the attacks, and that sales are now running well below the company's forecasts for a decline of 1% to 2% during the fall months, according to Reuters. But WalMart maintained its same-store sales growth projection for September of 4% to 6%. WalMart shares dropped 4.8% to $44. Federated shares lost 8.72% to $29.
said Monday earnings in its fiscal first quarter rose 18%, helped by a 5% boost in its systemwide unit volumes and a new goodwill accounting rule. Despite the good news, the company's shares ended off 1.51% to $45.04.