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Wednesday, February 18, 2009

The standard staples in a downturn have not fulfilled their expectations

Berkshire Reduces Stake in J&J as Buffett Turns to Fixed-Income
By Erik Holm and Linda Shen

Feb. 18 (Bloomberg) -- Warren Buffett’s Berkshire Hathaway Inc. cut holdings of Johnson & Johnson, the world’s largest maker of health-care products, and Procter & Gamble Co. as he turned his attention to fixed-income investments.

Buffett’s firm reduced its stake in New Brunswick, New Jersey-based Johnson & Johnson by 54 percent to 28.6 million shares in the three months ended Dec. 31, Berkshire said yesterday in a regulatory filing disclosing U.S. equity investments. The holding in Cincinnati-based Procter & Gamble, the biggest consumer-products company, fell by 9 percent.

Buffett is negotiating private deals to buy corporate debt and preferred shares as equity markets drop. Omaha, Nebraska- based Berkshire maintained its positions in Bank of America Corp. and American Express Co., financial firms that lost more than 45 percent their market value in the fourth quarter, while selling Johnson & Johnson and Procter & Gamble, which each fell less than 14 percent.

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