Finances

American Express Company (AXP), a financial services company, released its fourth quarter results on January 17.

American Express reported revenue of $8.1 billion for the quarter. This represents an increase of 5% from the same period last year when the company reported revenue of $7.7 billion.

The company also reported net income of $637 million for the quarter. This was a decrease of 47% from the same period last year when the company reported net income of $1.2 billion.

"With higher fourth quarter revenues and cardmember spending, we ended 2012 in strong shape," said Kenneth I. Chenault, Chairman and CEO. "Against the backdrop of an uneven economy, we capitalized on opportunities and continued to stay ahead of the trends that are reshaping our industry. The restructuring program we announced last week is designed to help take advantage of them, while also playing an important role in our aim of holding annual operating expense increases to less than 3% for the next two years. A lean operating structure is a critical advantage for any business. That, along with the flexibility to allocate resources toward growth initiatives, should put us in an even better position as we seek to deliver strong results for shareholders."

American Express, founded in 1850, was listed by Fortune magazine in 2011 as one of the Most Admired Companies in the World.

American Express (AXP) shares ended the week at $59.79.

eBay Reports Strong Quarterly and Annual Results

eBay Inc. (EBAY), a global commerce platform and payments lender, reported its quarterly and annual results on January 16.

eBay reported net revenue for the quarter of nearly $4 billion and annual revenue of $14.1 billion. The fourth quarter's revenue was an 18% increase from the $3.4 billion figure reported in the fourth quarter of 2011. The company's annual revenue was a 21% increase from last year's revenue of $11.7 billion.

The company also reported net income of $751 million for the quarter and $2.6 billion for the year. Both figures are a decrease from the same periods last year when the company reported quarterly and annual net income of $1.9 billion and $3.2 billion, respectively.

"We had a great finish to an excellent year, with fourth quarter results exceeding our expectations," said John Donahoe, eBay Inc. President and CEO. "eBay Marketplaces in particular had a terrific fourth quarter, with growth in the U.S. accelerating three points, outpacing ecommerce. Mobile continues to rewrite the commerce playbook, and we continue to be a mobile commerce and payments leader. eBay mobile finished the year with $13 billion in volume—more than double the prior year—and PayPal mobile handled almost $14 billion in payment volume, more than triple the prior year. In 2013, we expect each to exceed $20 billion. Web-enabled multichannel commerce is evolving quickly, and consumer shopping behavior is changing rapidly. Our focus is on being a global commerce leader in this new environment, connecting buyers and sellers everywhere, and being a preferred multichannel partner of choice for retailers and brands of all sizes."

Founded in 1995, eBay is one of the most famous success stories of the late 1990's Internet boom, growing to become a multimillion dollar business with operations in more than thirty countries.

eBay Inc. (EBAY) shares ended the week at $54.21.

Intel Finds the Profit Inside Its Annual and Quarterly Results

Intel Corporation (INTC), a multinational semiconductor chip maker, reported its quarterly and annual results on January 17.

The company reported quarterly and annual revenue of $13.5 billion and $53.3 billion, respectively. Both figures were a decrease from the same periods last year when Intel reported quarterly revenue of $13.9 billion and annual revenue of $54 billion.

Intel also reported quarterly and annual net income of $2.5 billion and $11 billion, respectively. These numbers were a decrease from 2011 when the company reported quarterly net income of $3.4 billion and annual net income of $12.9 billion.

"The fourth quarter played out largely as expected as we continued to execute through a challenging environment," said Paul Otellini, Intel President and CEO. "We made tremendous progress across the business in 2012 as we entered the market for smartphones and tablets, worked with our partners to reinvent the PC, and drove continued innovation and growth in the data center. As we enter 2013, our strong product pipeline has us well positioned to bring a new wave of Intel innovations across the spectrum of computing."

Founded in 1968, Intel is headquartered in Santa Clara, California and is the world's largest semiconductor chip maker.

Intel Corporation (INTC) shares ended the week at $21.25.

The Dow started the week at 13,498 and closed at 13,650. The S&P 500 started the week at 1,472 and ended at 1,486. The NASDAQ started the week at 3,126 and finished at 3,135.

Treasury yields rose for the fifth time in six days on Friday, January 18 as the Federal Reserve purchased nearly $1.57 billion of bonds maturing February 2036 through November 2042. The 10-year yields fell from their highest level in a week amid speculation that U.S. lawmakers will fail to agree on raising the nation's debt ceiling.

The 10-year Treasury note yield fell to 1.84% early Friday afternoon after having reached 1.89% earlier in the day. The 30-year bond yield fell slightly to 3.04%, a figure relatively unchanged from the 3.05% averaged throughout the week.

Much of the reason for the flat Treasury yields during the week was due to the uncertain status of U.S. debt ceiling negotiations. House Republicans held private meetings on Thursday, January 17 to discuss their strategy for addressing the upcoming debt ceiling deadline. The country will need to raise its $16.4 trillion debt ceiling next month to avoid the possibility of default and a further credit downgrade.

"We are awaiting further developments on the debt ceiling negotiations," said Nick Stamenkovic, a strategist at RIA Capital Markets Ltd. in Edinburgh. "There is no real evidence that the two parties are getting closer."

Along with the debt ceiling deadline, Congress will also need to address two other deadlines in March. First, Congress must address the $110 billion in automatic spending cuts that were put off with the passage of the American Taxpayer Relief Act. Second, on March 27 a short-term measure that funds government agencies will also lapse.

The 10-year Treasury note yield finished the week at 1.87% while the 30-year Treasury note yield finished the week at 3.03%.

Freddie Mac released the results of its weekly Primary Mortgage Market Survey (PMMS) on January 17. The results showed that average fixed mortgage rates continue to remain mostly unchanged, helping to keep home buying affordable.

The 30-year FRM averaged 3.38% this week. That represents a decrease from last week when it averaged 3.40%. Last year at this time the 30-year FRM averaged 3.88%.

The 15-year FRM averaged 2.66% this week, which is unchanged from last week's average. One year ago, the 15-year FRM averaged 3.17%.

Frank Nothaft, Vice President and Chief Economist at Freddie Mac, said, "Mortgage rates were flat to down a little this week amid reports that inflation remains contained. The overall producer price index rose 0.1% between November and December, below the market consensus forecast, and the consumer price index was unchanged. For the year as a whole, consumer prices rose just 1.7% in 2012, almost half that of 2011's increase of 3.0%."

The money market fund finished this week at 0.5%. The 1-year CD finished at 0.6%.