AMR Adds By Subtracting — Wednesday’s IP Market Recap

by Kyle Woodley | February 1, 2012 4:43 pm

IPMarketRecap AMR Adds By Subtracting    Wednesday's IP Market Recap[1]Some of Wednesday’s biggest market news actually came on the job front, as AMR Corp.’s (PINK:AAMRQ[2]) American Airlines announced a plan to lay off thousands in an attempt to emerge from bankruptcy, and reports about possible Microsoft (NASDAQ:MSFT[3]) cuts surfaced.

American Airlines said Wednesday that it would cut about 15% of its work force — some 13,000 jobs — in an attempt to save about $1.25 billion a year in labor costs. The company will cut about 4,600 jobs from maintenance alone, and the Transport Workers Union said it expects many of those jobs will be outsourced overseas, a common practice among the nation’s other major airlines.

American Airlines also hopes to save money through a shift in pension benefits and aircraft efficiencies. AAMRQ stock finished Wednesday trading sharply down, losing more than 11% to finish at 60 cents per share.

Also Wednesday, a report from Seattle television affiliate KOMO-TV (via Barron’s[4]) said Microsoft is prepared to make “significant layoffs” in restructuring. Microsoft lost about 7% of its value in 2011, though MSFT shares are off to a hot start in 2012, gaining 15% in a month.

Amazon (NASDAQ:AMZN[5]) stock was down about 8% after a day’s worth of marinating on Tuesday’s gloomy earnings report[6]. The company’s revenues increased but came up well short of estimates, profits dropped by almost 60%, and Amazon laid out a weak forecast for its first-quarter earnings.

Three Up

Three Down

Kyle Woodley is the assistant editor of InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities. Check out recaps from previous trading days here[13].

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/11/IPMarketRecap.gif
  2. AAMRQ: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAMRQ
  3. MSFT: http://studio-5.financialcontent.com/investplace/quote?Symbol=MSFT
  4. via Barron’s: http://blogs.barrons.com/techtraderdaily/2012/02/01/msft-seattles-komo-tv-says-layoffs-coming-in-restructuring/http:/blogs.barrons.com/techtraderdaily/?mod=BOL_hpp_blog_techtrader
  5. AMZN: http://studio-5.financialcontent.com/investplace/quote?Symbol=AMZN
  6. gloomy earnings report: http://investorplace.com/2012/02/headwinds-against-amazon-may-be-rising/
  7. STX: http://studio-5.financialcontent.com/investplace/quote?Symbol=STX
  8. WHR: http://studio-5.financialcontent.com/investplace/quote?Symbol=WHR
  9. MPC: http://studio-5.financialcontent.com/investplace/quote?Symbol=MPC
  10. RENN: http://studio-5.financialcontent.com/investplace/quote?Symbol=RENN
  11. XCO: http://studio-5.financialcontent.com/investplace/quote?Symbol=XCO
  12. ARMH: http://studio-5.financialcontent.com/investplace/quote?Symbol=ARMH
  13. here: http://investorplace.com/hot-topics/investorplace-market-recap/

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