AFTER HOURS
Amex warning weighs on evening trades
SAN FRANCISCO (MarketWatch) - American Express Co. shares lost more than 5% in extended trading Thursday after the credit card giant said it will take a fourth-quarter charge because of slower spending and higher delinquencies last month.
The Nasdaq-100 After Hours Indicator, which tracks the evening action of the tech-heavy index's leading stocks, eased 6 points to 1,948, with American Express perched near the top of the decliners list after its warning.
The charge, $440 million pre-tax, will raise worldwide lending revenue to 100% of past-due loans and increase reserves related to the charge card portfolio, Amex said.
The company also said that it expects to report fourth-quarter delinquencies in its managed U.S. lending portfolio increased to 3.2% from 2.9% in the third quarter, while the write-off rate in the portfolio rose to 4.3% from 3.7%.
American Express said expects card-member spending to slow in 2008, with full-year earnings growth of 4% to 6%
The announcement took some of the shine off of the regular-session rally in which Fed Chairman Ben Bernanke signaled more interest-rate cuts ahead. A report that Bank of America Corp. is in talks to buy Countrywide Financial Corp. also brought out the buyers.
www.marketwatch.com/news/story/...79C%2DAF21%2D4684C44DBA80%7D
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