Biggest Loser: AmEx shares sink on weak outlook

NEW YORK: American Express shares plummeted after it offered a dim profit outlook that highlighted intensifying competition for high-end customers and announced plans to cut $1 billion in spending. The banking and credit card company sank 12.6% to $54.78 in afternoon trade, by far the biggest loser in the Dow on an up day for stocks. Investors fled the stock after chief executive Kenneth Chenault outlined a range of hurdles facing the company, including overall economic sluggishness, pressures on merchants’ fees and “intense competition that has been reshaping the payments industry.” News that the company plans $1 billion in spending cuts fell flat with investors who are looking for details on how AmEx can better exploit its affluent client base in the mobile era, said Morningstar analyst Jim Sinegal.

Published in The Express Tribune, January 24^th, 2016.

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