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US stock market daily report (January 07, 2013, Monday)

Contributed by Millennium Traders

The Federal Reserve and Office of the Comptroller of the Currency reported a settlement to the tune $8.5 billion on Monday with ten large financial institutions over foreclosure abuses, stemming from the so-called robo-signing scandal. The settlement includes $3.3 billion in cash payments to borrowers who went through problematic foreclosures. An additional $5.2 billion will be distributed to homeowners in danger of losing their homes to foreclosure. Banks involved in the settlement include: Bank of America (BAC), Citigroup (C), J.P. Morgan Chase & Co. (JPM), Wells Fargo (WFC) plus six other banks. The settlement seeks to provide assistance to more than 3.8 million borrowers, including the 495,000 review-seekers whose homes were foreclosed upon or were subject to other bank abuses in 2009 and 2010. As part of the deal, the OCC said the participating banks would end their independent foreclosure case-by-case review and replace it with the approach where payments would go out to eligible borrowers more quickly. Federal Regulators are still in discussions with Ally Financial, EverBank Financial Corp (EVER), HSBC and OneWest Bank regarding their part in a settlement. The settlement comes nearly a year after state and federal government officials in February 2011 agreed to a record housing settlement of more than $26 billion with five of the country's biggest banks over foreclosure abuses.

Bank of America Corp. (BAC) on Monday reported a reached agreement with Fannie Mae (FNMA) to settle all repurchase and certain other claims surrounding almost all of the mortgage loans originated by Countrywide Financial Corp and Bank of America National Association from 2000 through 2008. Part of the deal includes BofA agreeing to pay $3.6 billion to Fannie Mae as well as paying $6.7 billion to repurchase, "certain residential mortgage loans sold to Fannie Mae, which Bank of America has valued at less than the purchase price." BofA added that it expects to cover settlement costs from existing reserves as well as an additional $2.5 billion pretax charge taken in the 2012 Q4 which will fund an agreement to pay Fannie Mae to settle substantially all of Fannie Mae's outstanding and future claims for compensatory fees arising out of past foreclosure delays. "Together, these actions described above are expected to reduce Bank of America's pretax income by approximately $2.7 billion in the fourth quarter of 2012," BofA said. After laying out the costs associated with the settlement, as well as some other items, BofA said it expects "earnings per share to be modestly positive for Q4 2012."

According to the Centers for Disease Control and Prevention, flu season has arrived earlier than usual this year and appears to be the worst experienced, in years. At least 41 states have reported outbreaks with 18 states reporting epidemic levels. "Influenza activity continues to increase in the United States with most of the country now experiencing high levels of influenza-like-illness," the CDC said, noting that current levels are already nearing what have been peak levels during moderately severe seasons in the past. Eighteen children have already died for influenza this year, the CDC added. The main way that influenza viruses are thought to spread is from person to person in respiratory droplets of coughs and sneezes. People are urged to stay at home if they experience flu like symptoms to avoid exposing others to the potentially life threatening illness as well as, patients with symptoms need plenty of rest and should seek medical attention should symptoms worsen. More details on the flu available at www.cdc.gov/flu/.

The Conference Board - a New York-based private research group - reported on Monday its employment-trends index, a gauge of employment trends rose during December, although current job growth may be difficult to keep up. The index is designed to forecast turning points in employment which increased 0.77% in December. The index is made up of eight labor-market indicators, four of which made positive contributions during December which moved higher by from l2011. The index hit 109.02 in December, compared with 100 during 1996. "After posting a significant increase in December, following an upward revision in November, the employment trends index is improving," said Gad Levanon, macroeconomic research director at the Conference Board. "However, if economic activity continues to expand slowly in the first half of 2013, it would be difficult for employers to maintain the current rate of job growth."

Apple's App Store is humming! "It has been an incredible year for the iOS developer community," said Apple executive Eddy Cue. "Developers have made over seven billion dollars on the App Store, and we continue to invest in providing them with the best ecosystem so they can create the most innovative apps in the world." On Monday, Apple Inc.(AAPL) reported its App Store has surpassed 40 billion downloads, with nearly 20 billion of those taking place during 2012. Apple also reported that December set a record of two billion downloads.