Spotlight Stocks: Cleveland-Cliffs, Fannie Mae, Lehman Brothers, Washington Mutual
Thursday's top stories and stocks with potential to move.
Stocks to watch for Thursday, September 11, 2008:
- Cleveland-Cliffs (CLF) has made an offer to acquire Portman, an Australian iron miner, worth A$560 million ($450.5 million). The deal would be worth A$21.50 a share, which is a 21% premium to yesterday's closing price of A$17.70. CLF already owns an 89.15% stake in Portman. Additionally, CLF will pay A$26 million for shares and options over 30 percent of AusQuest, reported Reuters. AusQuest is prospecting for manganese in west Australia.
- Fannie Mae (FNM) sold two-year notes worth $7 billion, a record, to investors who have been calmed by the government's bailout of the mortgage giant. The Wall Street Journal reports the notes received more than $9 billion of orders, which helped decrease the financing costs, citing people familiar with the deal. The debt was sold at 0.70 percentage point over comparable Treasurys, to yield 2.896%.
- Lehman Brothers (LEH) was cut at Citigroup from 'buy' to 'hold' as the company may have its credit rating cut after it posted its largest quarterly loss yesterday. The analysts also lowered their earnings-per-share estimates for Lehman for this year, 2009 and 2010. Also, yesterday Lehman said it will auction off a 55 percent stake in its asset-management unit, which oversees $277 billion, including funds run by Neuberger & Berman. According to private equity firms interested, the unit could be valued at around $5 billion.
- Washington Mutual (WM) shares hit a 17-year low yesterday after Lehman's announcement that it was selling off some of its assets. Shares lost 98 cents, or 29.7% and closed at $2.32. The low on the day was $2.30. Shares of WM have lost 92% since July of 2007.
- Asian trading closed with the Hang Seng -3.06%, Nikkei -1.98%, Sensex -2.31%, Taiwan -3.19% and Shanghai -3.34%.
- Over in Europe, we see the CAC -0.86%, DAX -1.24%, FTSE -1.05%, ATX +0.35%, Swiss Market -0.93% and Stockholm -1.26%.
- In commodities, crude oil is trading lower -0.77 to 101.81 and gold is also down -16.8 to 742.1 this morning.
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