NEW YORK (
) -- Here are the top stock market headlines for the morning of Tuesday, Jan. 12, 2010.
Tuesday's Earnings Roundup
- Alcoa (AA) - Get Report unofficially kicked off the fourth-quarter earnings parade late Monday with its quarterly numbers. The aluminum giant posted an adjusted profit of a penny a share, disappointing analysts who had expected earnings of 6 cents a share, according to Thomson Reuters. Revenue fell slightly from a year ago to $5.4 billion, although that was higher than the consensus target of $4.82 billion.
- Infosys (INFY) - Get Report posted a fiscal third-quarter profit of 59 cents a share, better than the Thomson Reuters average estimate of 51 cents a share. Revenue climbed 5.2% from a year ago to $1.23 billion, also higher than estimates. Looking ahead, Infosys offered stronger-than-expected earnings and revenue guidance for its fourth quarter and fiscal year. Bank of America/Merrill Lynch analysts upgraded the stock to buy following the earnings announcement.
- KB Home (KBH) - Get Report will post results later Tuesday morning, with analysts expecting a loss of 96 cents a share on revenue of $577.5 million, according to Thomson Reuters. That would be an improvement from a year-ago loss of $3.96 a share.
- Supervalu (SVU) is also set to offer earnings results Tuesday. Analysts are targeting a profit of 40 cents a share on sales totaling $9.43 billion.
Tuesday's Early Headlines
- Fed Earned $45 Billion in 2009: Report -- The Federal Reserve made record profits of $45 billion during 2009, The Washington Post reports, citing internal calculations it made based on public documents. The Fed plans to release its estimate of 2009 earnings Tuesday. According to the Post, this marks the highest earnings in the 96-year history of the central bank whose unconventional efforts to prop up the economy created a windfall for the government. The Fed's earnings during the year will reportedly top the combined expected profits of some of the largest banks such as Bank of America (BAC) - Get Report, Goldman Sachs (GS) - Get Report and JPMorgan Chase (JPM) - Get Report.
- Bank of America in Settlement Talks Over State Claims -- Bank of America (BAC) - Get Report is negotiating with the staff of New York Attorney General Andrew Cuomo to settle claims that the bank failed to adequately disclose the risks of its takeover of Merrill Lynch to its shareholders a year ago, The New York Times reported, citing people with knowledge of the matter. While no settlement has been reached and the talks are continuing, Bank of America's new CEO Brian Moynihan is interested in bringing an end to myriad legal troubles plaguing the bank, the paper reported, adding that both sides met last Friday to discuss a possible deal.
- Obama May Impose Bailout Fee on Banks -- The Obama administration is planning to impose a bailout fee on banks to recoup losses from the government's bailout program, administration officials said. The White House hopes the fee will soothe the public anger at financial firms which have resumed paying big bonuses to employees, The Wall Street Journal reports. Aided by taxpayer support, the industry is now enjoying a profit rebound even as the economy struggles. House Financial Services Committee Chairman Barney Frank told the Journal, "Given the mood of the country it is essential that we do it. That was part of the deal."
- Cadbury Steps Up Fight Against Kraft -- Cadbury (CBY) said its 2009 "performance is well ahead of market expectations" and said Kraft Foods' (KFT) takeover bid for the U.K. confectionary maker is "even more unattractive today" than when it was first posted. Cadbury again said Kraft's offer of about $16.5 billion was "derisory" and recommended shareholders take no action on the bid.
- Senate Mulls Over Special Bankruptcy Court Option for Banks -- Reuters reports that some key U.S. senators are considering the creation of a special bankruptcy court for troubled financial services firms, citing a person familiar with the plans. Members are discussing a two-stage process that would create a preferential option for bankruptcy followed by a regulator-managed resolution if bankruptcy fails, the person told Reuters. The push from certain members of the committee is a response to Senate Banking Committee Chairman Christopher Dodd's proposal for regulation overhaul, as some senators want a more specific and tougher regime to deal with troubled financial firms.
-- Written by Robert Holmes in Boston
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