Weekly Market Recap: Facebook Hits NEW LOWS, Morgan Stanley Deflects BLAME
Shares of Morgan Stanley (NYSE:MS) were down after Morgan Stanley Chief Executive James Gorman told employees that the firm participated “100% within the rules” during its lead-underwriting role in the Facebook Inc. (NASDAQ:FB) IPO. Gorman, in his weekly strategy meeting that was later webcast to employees, said “speculation of nefarious activity” around the social networking company’s IPO is not true. Regardless of some reports, he said, he was not “aware of any dissent” between underwriting firms and Facebook’s $38 per share IPO price, reported MarketWatch. Fellow Facebook underwriter and rival, Goldman Sachs (NYSE:GS) are down another .63% percent to $94.01.
Don’t Miss: Is This Positive News For Facebook Shares?
Facebook’s (NASDAQ:FB) stock continues to hit new lows. Shares fell to a new low of $27.06 as the company’s stock continues to struggle after its IPO. Wedbush analyst Michael Pachter said to MarketWatch, “Institutions don’t like to buy stocks on the way down, and retail investors don’t have a lot to base an investment decision on. The stock will work when there is widely disseminated research and when the company starts showing its alignment with shareholders.”
Research in Motion (NASDAQ:RIMM) dropped almost almost 8% after the company hit a 52-week-low of $10.01 and received negative analyst updates. It also warned of a tough competitive environment and announced the hiring of outside advisers to review its business opportunities. Today shares are up .38%.
Lions Gate Entertainment Corp. (NYSE:LGF) reported a fiscal fourth-quarter loss while seeing higher marketing and acquisition expenses cloud rising revenue from its two successful young-adult series. In after-hours trading, shares fell 6.6% to $12 with the surprising loss, but today have rebounding upward 1% to $12.98. Even with its high costs in the quarter, Chief Executive Jon Feltheimer said most of “The Hunger Games” movies and the November release of “The Twilight Saga: Breaking Dawn: Part 2″ profits will be included in the upcoming quarters.
Ford Motor Co (NYSE:F) will finally bite the bullet on its mounting pension liabilities and offer lump sum pension buyouts to about 98,000 retirees and former employees. A current estimate of Ford’s U.S. pension liability puts it at around $49 billion. The above buyouts, which are voluntary, may clip a third of that if they are successful. Ford’s global liability is put at above $74 billion, with a funding shortfall of $15.4 billion at the end of 2011.
Ciena Corp. (NASDAQ:CIEN) reported its second quarter earnings with a $0.04 per share on an adjusted basis. This beat estimates of a $0.03 loss per share. Revenue jumped 14.3% to $477.6 million from the year-earlier quarter. Ciena’s Gary Smith, president and CEO said of the report, “Our second quarter was highlighted by strong revenue growth and positive overall operating performance, which demonstrated our ability to deliver operating leverage. We remain confident that we are well positioned for future growth and continue to expect our second half operating results to be stronger than the first half.”
Talbots Inc. (NYSE:TLB) jumped 91% on the news of its pact to be bought by Sycamore Partners in a $193.3 million transaction. Stockholders will receive $2.75 a share, which came in lower than Sycamore’s previous $3.05 a share offer. Talbots has been facing tough times after closing 90 stores since March 2011, enduring five consecutive years of declining sales and remaining without a replacement for its retiring Chief Executive Officer Trudy Sullivan.
Netflix Inc. (NASDAQ:NFLX) fell 5.6% after the Bank of America/Merrill Lynch (NYSE:BAC) slashed the company’s 2012 earnings forecast, noting costs related to its international expansion and a potential stall in U.S. streaming growth. In the past week, the stock has dropped 10%, 21% in the last month, and in the second quarter, down 45%.
Intel’s (NASDAQ:INTC) shares fell after Morgan Stanley started coverage on the stock with an underweight rating. The bank noted slower growth and a potential margin erosion for Intel. On Thursday, Intel was one of the worst Dow Jones Industrial Average performers.
With rumors of a television product from the company persisting but not yet verified, at least one source is now contending that Apple (NASDAQ:AAPL) may be working on fulfilling another of co-founder Steve Jobs’ interests in reinventing an industry. According to the New iPad Buyers’ Guide published by iLounge this week, Apple could be working on a standalone camera product.
BP PLC (NYSE:BP) rose $0.30 cents to close at of $36.76. The London-based company announced plans to pursue the sale of its 50 percent interest in TNK-BP following an unsolicited bid for its stake in the large Russian joint-venture stake, reported MarketWatch.
Groupon’s (NASDAQ:GRPN) shares hit an all-time low after the restriction for insiders to trade expired. The stock hit a new low of $9.53 during the trading session before closing at $9.69. More than 600 million Groupon shares had been released, which represented 93 percent of outstanding shares.
Hewlett-Packard (NYSE:HPQ) dropped 6.3% to close at $21.25. The company took a hit from an analyst downgrade. Jefferies analyst Peter Misek cut his rating on the stock to hold from buy citing worries on several fronts.