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News That Moved the Market
Stimulus Plan Set. Markets ended the day higher after government officials announced President Bush and House members had come to an agreement on the economic stimulus plan. The new plan will give rebates to 117 million American families and help businesses purchase new equipment. Essentially, it gives the average American a $300 rebate, with people earning higher incomes getting less, and families with children getting more. It will also increase the mortgage size Fannie Mae (FNM, -1.7%) and Freddie Mac (FRE, -1.6%) will be allowed to purchase to $625,000 from $417,000, increasing the availability for financing for higher-valued homes. Some investors were disappointed the rebates were not higher, and also questioned why the government was going out of its way to help Americans buy $600,000 homes.
Existing Homes Sales Down, But So Are Inventories. The National Association of Realtors reported existing home sales dropped 2.2% last month, but said unsold home inventories actually decreased. In all, single-family home sales fell 13% last year, the worst drop since 1982.
Nokia Surges on Q4 Performance. Cell phone maker Nokia (NOK, +12.5%) jumped after reporting a 57% increase in earnings and noting strong demand in emerging markets. The company's global market share now stands at 40%.
Rogue Trader at SocGen Loses $7.1 Billion. Societe Generale, the second largest bank in France, surprised the world by announcing a single trader concealed positions and made up transactions leading to a $7.1 billion loss for the bank. When the fraud was discovered, the bank liquidated all positions, but the news created questions about SocGen's risk management controls. SocGen, which trades in Paris, fell 3.7%.
AT&T Reports Higher Profits. AT&T (T, -2.6%) said Thursday Q4 earnings jumped 62%, propelled by acquisitions and wireless growth. The company still had mixed news for its traditional phone service, losing more customers than expected.
Microsoft Jumps in After Hours Trading.Microsoft (MSFT, +4.1%; +5.0% A.H.) pushed futures higher after the close, beating estimates and raising profits and sales targets for the year. Strong sales in Windows and Xbox 360 consoles were key drivers in the solid report.
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