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Friday, February 13, 2009


*Everyday is a new report of some company cutting its dividend.

S&P heads to first quarter ever of negative earnings
Financials the biggest factor in decline, but ConocoPhillips a big hit as well
By Kate Gibson, MarketWatch

As Wall Street tracks Washington's moves to help the beleaguered banking sector and pass more economic stimulus, nearly 400 of the S&P's 500 companies have weighed in and reported a collective loss -- even excluding financials. "This is the worst, after the sixth quarter of negative growth, it will be the first quarter ever of negative earnings," said Howard Silverblatt, senior index analyst, at Standard & Poor's. A sixth quarter of negative growth ties the prior record set when Harry Truman was president, and ran from the first quarter of 1951 to the second quarter of 1952. "And next quarter we're expected a new record of seven quarters of negative growth," Silverblatt said.

As of the close of business Thursday, Silverblatt calculates S&P earnings-per-share, on a reported basis, at a loss of $10.44 for the quarter. If financials were taken out of the equation, that EPS deficit would drop to $2.35.
"The majority of it is financials, but the biggest issue to hit as reported -- the worst charge -- was ConocoPhillips (COP:ConocoPhillips Last: 46.25+0.05+0.11% COP 46.25, +0.05, +0.1%) . That one charge accounted for $3.66," said Silverblatt.

Income from continuing operations at the companies in the S&P 500 that have already reported earnings fell $90.8 billion, with financials contributing $70.4 billion of the decline. Conoco accounted for $31.9 billion of the shortfall, said Silverblatt.
Financials also led losses in Friday trade. Telecommunication issues fronted the gains. The Dow Jones Industrial Average ($INDU:Dow Jones Industrial Average $INDU 7,872.95, -59.81, -0.7%) was down 63.79 points at 7,868.97 in afternoon trading.
The S&P 500 ($SPX:S&P 500 Index $SPX 829.69, -5.50, -0.7%) fell 5.56 points at 829.66, and the Nasdaq Composite (COMP:Nasdaq Composite Index COMP 1,537.27, -4.44, -0.3%) was down 3.88 points at 1,538.83.

With 84.8% of the market value and 390 issues reported, operating earnings, which includes income from products or services and excludes financing and other costs, are down 62% from the fourth quarter of 2007, Silverblatt said.

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