1) Phil's Financial Tip of the Day:
Organizing your important papers and personal information is a smart move and a great gift to your loved ones.
Great advice for Seniors and all those who want to get organized. Here are some tips to help you get started:
Savvy Senior: Organize your personal, financial information-From The Daily Record of NJ
http://www.dailyrecord.com/apps/pbcs.dll/article?AID=/201201170827/NJLIFE09/301170004
2) In the Markets today:
U.S. stocks advanced after better-than-expected economic data, set for highest close since late July. Financials fell.
Stocks Post Broad Gains; Financials Fall-From The Wall Street Journal
U.S. stocks were ahead but well off session highs late Tuesday as an early rally ran up against technical resistance and weakness in bank stocks after a handful of key earnings reports.
The Dow Jones Industrial Average climbed 46 points, or 0.4%, to 12465 in afternoon trade, though the measure was up by as much as 151 points early in the session. The gains were still enough to push the blue-chip index to what would be a fresh closing high since late July. The Dow already breached five-month highs earlier this month.
The Standard & Poor's 500-stock index was ahead by 2 points, or 0.2%, to 1291 recently and the Nasdaq Composite rose 12 points, or 0.4%, to 2722.
Stocks' early rally on stronger-than-expected economic data in the U.S., China and Germany started to hit headwinds midsession in what traders ascribed to a mix of factors, the most important of them technical in nature.
"We keep bumping up higher, which is good, [but] it gets to this level and peters out," said Alan Valdes, director of floor trading at DME Securities. "There's no volume [and] a lot of guys are just day trading this thing," he added.
Bank stocks, which were weak all session, moved deeper into negative territory. Citigroup set a negative tone in financial stocks early in the session when it posted an 11% drop in fourth-quarter profit and its results fell well short of analysts' expectations. J.P. Morgan Chase was the weakest stock in the Dow, falling 2.7%.
"J.P. Morgan's earnings were mediocre on Friday and Citi was poor today. The banks are dragging the overall market down," said Tom Donino, co-head of trading at First New York Securities.
The earlier gains followed a jump in a gauge of New York manufacturing activity, strength in German economic sentiment and better-than-expected Chinese economic growth figures. European markets gained and the 4.2% rise in the Shanghai Composite was the biggest since October 2009.
In corporate news, cruise-line operator Carnival's stock was one of the worst performers in the S&P 500, slumping 14% after one of the company's cruise ships capsized off the coast of Italy over the weekend. Fellow cruise ship operator Royal Caribbean dropped 5.3%.
3) Top financial story of the day:
Citi's fourth-quarter profit fell from a year earlier as choppy capital markets overshadowed the bank's loan growth globally.
Citigroup profit falls 11 percent, misses Street view-From Reuters
Citigroup Inc's fourth-quarter profit fell 11 percent and missed Wall Street estimates as the European debt crisis battered capital markets, hurting trading revenue and discouraging clients from doing deals.
Citi on Tuesday said the crisis and fears about its impact on other markets and the global economy led to a broad move by clients away from risk and a decline in market volumes around the world. Fixed income, equity markets and investment banking revenues all declined in the quarter.
"The operating environment continues to be extraordinarily challenging in a number of businesses, none more so than securities and banking," Chief Financial Officer John Gerspach said on a conference call with analysts.
Citi's results show how investment banking units are dragging down profits for large Wall Street firms, and portend a tough fourth quarter for others such as Goldman Sachs Group Inc and Morgan Stanley, which report their results later this week.
In contrast, banks that focus more on business and consumer lending are doing better as the U.S. economy shows signs of recovery. Wells Fargo & Co beat analysts' earnings estimates on Tuesday, helped by improving credit quality and loan growth.
This trend was also reflected last week in the results of JPMorgan Chase & Co.
Money manager Jeffrey Sica, president of SICA Wealth Management, an independent wealth manager based in Morristown, New Jersey, which has bet against a basket of bank stocks, said Citi's earnings miss was "horrendous" in light of how much estimates had come down.
"It's a very negative sign for banks in general," said Sica.
Citigroup shares fell 6 percent in midday trading on the New York Stock Exchange, lagging the KBW banks index, which was down 0.2 percent.
"Clearly, the macro environment has impacted the capital markets and we will continue to right-size our businesses to match the environment," Citigroup Chief Executive Vikram Pandit said in a statement.
Pandit said the bank was cutting about 5,000 jobs and had taken a $400 million charge in the fourth quarter for severance payments. The bank, which has about 266,000 employees, said in December that it would cut 4,500 jobs and take that charge.
The world's major banks have announced more than 133,000 layoffs since mid-2011 as euro zone woes take their toll on trading income and investment banking.
Citi, the third-largest U.S. bank by assets, reported net income of $1.16 billion, or 38 cents per share, down from $1.31 billion, or 43 cents per share, a year earlier.
"Citi's number to come in like this, still missing even though estimates were already cut, that's a cause of great concern," said Todd Schoenberger, managing director at LandColt Trading in Wilmington, Delaware.
Citi said securities and banking revenue fell 29 percent from a year earlier, excluding the accounting impact of changes in the value of the bank's debt.
The profit drop came despite a lower provision for bad loans: down 41 percent to $2.9 billion.
Citi Holdings, which holds assets the bank plans to sell, posted a 30 percent decline in revenue to $2.8 billion as it continued to shed assets.
Citi Holdings had $269 billion in assets at the end of the fourth quarter, down about $90 billion from a year earlier.
Citigroup's operating expenses increased 4 percent to $12.9 billion in the fourth quarter. Pandit said the bank expects to reduce expenses by between $2.5 billion and $3 billion in 2012 from the $50.7 billion it posted for all of 2011.
4) Quote of the Day from Dave Ramsey.com:
Whoever wants to reach a distant goal must take small steps. — Helmut Schmidt
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