Reliant, Hartford Financial Plunge; Google Reset

123jump.com Staff
30 Sep, 2008
New York City

Google dropped on erroneous trading and Nasdaq reset its price near $400. Hartford Financial Services plunged after Fitch puts its life insurance division related debt on a negative watch. Genworth Financial surged on the hopes that company will sell or spin off its mortgage unit.

[R]7:30PM New York – Hartford Financial Services plunge on lowered rating outlook and Reliant Energy plunge on revised earnings outlook. Google drops.[/R]

Dr Pepper Snapple Group, Inc ((DPS)) rose 9% or $2.20 to $26.48 after the company was selected to add in the S&P 500 index and replace W. Wrigley & Company after it agreed to be acquired by Mars Inc and the deal is expected to be completed before October 6.

Genworth Financial, Inc ((GNW)) rose 72.20% or $3.61 to $8.61 after the company looked for ways to spin-off its troubled mortgage insurance business. The company was listed as a separate company after General Electric spun it off in an initial public offering and sold remaining 71 million shares at $32.75 a share on March 3, 2006.

Google Inc ((GOOG)) dropped 18% or $60.50 to $320 but after the close Nasdaq cancelled the orders between 3:57 and 4:02 p.m. and traded at a price above $425.29 and at or below $400.52 and firmed the closing price at $400.52. The Nasdaq said that this decision cannot be appealed.

Hartford Financial Services ((HIG)) plunged 18% or $9.01 to $40.99 after investment rating services provider Fitch put its debt on negative watch list. Fitch said that the earnings and capital level at its life insurance division have deteriorated because of weaker capital market environment.

Huntsman Corporation ((HUN)) gained 72% or $5.25 to $12.96 after a judge ordered private equity firm Apollo Management and its unit Hexion Specialty Chemicals Inc to honor the terms of their $6.5 billion offer. The specialty chemical maker was the subject of takeover battle between Apollo controlled fund and Dutch based Basell. Hexion had agreed to offer $27.25 a share for Huntsman in June of 2007.

Intel Corporation ((INTC)) rose 8.5% or $1.46 to $18.73 after a Piper Jaffray analyst upgraded the stock to ""Buy.""

Brokerage and banks rallied on the hope that legislators will pass a revised bailout plan. The Goldman Sachs Group, Inc ((GS)) rose 6% or $7.30 to $128, JPMorgan Chase & Co ((JPM)) rose 13.90% or $5.70 to $46.70 and Morgan Stanley ((MS)) rose 9.6% or $2 to $23.00.

Bank of America ((BAC)) surged 16% or $4.75 to $35, Wells Fargo (WFC)) rose 13% or $4.28 to $37.53 and JP Morgan Chase soared 14% or $5.70 to $46.70. Citigroup ((C)) 16% or $2.76 to $20.71.

Sovereign Bancorp, Inc ((SOV)) gained 69% or $1.62 to $3.95 after the company replaced its chief executive and Fifth Third Bancorp raised its rating on the company.

The Pepsi Bottling Group, Inc ((PBG)) rose 4% or $1.10 to $2917 after it reported third quarter revenue gain of 2% to $3.81 billion from $3.73 billion and net income fall of 11% to $231 million or $1.06 per diluted share compared to net income of $260 million or $1.12 per share, a year ago.

Reliant Energy ((RRI)) plunged 27% or $2.73 to $7.35 after the company lowered its outlook and replaced its current credit facility of $1 billion. The company raised $650 million in secured financing from Goldman Sachs at interest rate of 4.5% plus to Libor rate and $350 million convertible preferred debt with First Reserve at a whopping 14%. The conversion price is lesser of $11 and lowest 20-day average price in the six months after the closing with a price floor of $8.

The company has unsecured credit facility of $300 million with Merrill Lynch which will be terminated before the end of October.