Alcatel loses again, scraps dividend
Alcatel-Lucent, the world’s No. 1 maker of telecommunications equipment, said it lost $3.8 billion in its fourth quarter, including a $3.7 billion writedown on wireless assets, and scrapped its 2007 dividend payment. Analysts had expected a profit, excluding the writedown. (MarketWatch) Revenue rose a higher-than-expected 18 percent, but the company predicted a loss in the first quarter. Alcatel-Lucent has lost almost $20 billion in market share since its December 2006 merger. After the merger, “we expected a profit and it was loss,” said Frederic Hamm at Agilis Gestion. “Again they report a loss, with a profit warning as well. It’s a little worrying.” (Bloomberg)
Exxon wins $12 billion from Venezuela
Exxon Mobil won a round in its protracted fight with Venezuela, as courts in several countries agreed to freeze more than $12 billion in assets held by state-run oil firm Petroleos de Venezuela SA (PDVSA). ( Exxon is seeking compensation after PDVSA took control of two joint oil projects last year, in a natural-resources nationalization campaign by President Hugo Chavez. Venezuela’s dollar-denominated bonds dropped their steepest amount since August on the news, as the freeze could hamper PDVSA’s ability to raise capital. “This is a big blow against Venezuela,” said oil analyst Pietro Pitts. (The New York Times, free registration)
Congress sends stimulus package to Bush
Congress overwhelmingly passed a $168 billion fiscal stimulus package that, after signed by President Bush, as expected, will send checks to more than 130 million households as soon as May. (The Wall Street Journal) The package gives $600 to single taxpayers and $1,200 to couples, plus $300 per child, with those amounts phasing out for couples who earn at least $150,000 a year. It also temporarily raises the amount that federal mortgage agencies can lend, to $729,750 per loan. Bush called the unusually swift passage of the bill “an example of bipartisan cooperation at a time when the American people most expect it.” (AP in Yahoo! Finance)
A party at the end of the party
The financial professionals who brought us intricate mortgage-backed securities and collateralized debt obligations gathered in Las Vegas this week for the 5th annual American Securitization Forum. Given the credit crunch that accompanied the collapse of many of these securities, the lavish parties were a little more somber than in high-flying years past. Participants were there to learn, vent, and take stock. “As a trader, if you make money for too many years you lose sight of risk unless you get sucker-punched,” said money manager John Devaney, who had to sell a Florida mansion, private jet, and yacht in last year’s rout. (The New York Times, free registration)