Chin Up in the Downswing: Wells Fargo Forecasts $3 Billion Q1 Profit; U.S. Revolving Debt, New Jobless Claims and Trade Deficit All Decrease
by Anne Szustek
Among today’s positive business and financial stories: bank Wells Fargo forecasts $3 billion in profits for Q1 2009, the Fed reports that Americans are cutting down on their revolving debt, new unemployment claims were down last week and the trade deficit narrowed to November 1999 levels.
Shares of bank Wells Fargo were up almost 23 percent during Thursday morning trading, bolstered by forecasts that it raked in some $3 billion in profits during the first quarter of 2009. Wells Fargo said in a press release that the bank’s merger with Wachovia “exceeded expectations.” The New York Times DealBook blog writes that the Wells Fargo news helped to pull up other financial stocks Thursday morning.
Revolving debt, which comprises credit card debt, was down 9.7 percent, according to a report released by the Federal Reserve Tuesday afternoon. This indicates that perhaps American consumers are being more careful about spending, and that people are paying off their credit card debt in light of tightening lines of credit.
The number of new jobless claims in the United States dropped last week to a seasonally adjusted 654,000, down from 674,000 two weeks before, according to statistics released today. Another positive sign featured in this Reuters clip: Commerce Department numbers showed that the U.S. trade deficit was down in February to its lowest levels seen since November 1999, when the economy was robust. This suggests, writes Reuters, “that the drop in first-quarter gross domestic product was probably not as steep as the previous period's 6.3 percent annual pace of decline.”