Citigroup, Inc. (C) could have done better. Revenue from bond trading took a big hit. John Gerspach, Chief Financial Officer acknowledged that fixed income was weak and needs fixing.

Citi's profit was $1.3 billion compared with the year earlier loss of $7.6 billion. Revenue more than tripled to $18.4 billion from $5.4 billion a year ago. However it fell 11% from the third quarter. Citi has been aggressive in hiring more bankers causing expenses to rise. Earnings per share were four cents compared with a loss of 33 cents a year ago, as reported in the Wall Street Journal.

Applied Materials (AMAT) announced Wednesday that it will cut as many as 500 jobs and that it will take a third-quarter charge as it cuts its solar manufacturing presence.

AMAT is going to decrease its thin-film solar manufacturing equipment products, known as SunFab. AMAT will now focus on crystalline silicon equipment and light-emitting diodes. As a result of this move, AMAT will need to cut jobs and it will take a third-quarter charge between $375 million and $425 million (18 to 21 cents per share).

AMAT also lowered its adjusted the target on its third-quarter earnings to 10 cents to 14 cents per share. Originally, AMAT forecast earnings between 22 and 26 cents per share.

MAJOR PAPERS:

• The Wall Street Journal reported that President Bush picked former advisor Robert Zoellick to take over the World Bank from Paul Wolfowitz; Mr. Zoellick, now a vice chairman at Goldman Sachs Group Inc (NYSE: GS), was a trade representative and deputy secretary of state.
• The Institutional Shareholder Service has advised shareholders of medical device maker Biomet Inc (NASDAQ: BMET) to turn down a $10.9B private equity deal for the company, according to the Wall Street Journal.
• The Financial Times reported that the IntercontinentalExchange Inc (NYSE: ICE) has signed an exclusive deal with the CBOT Holdings Inc (NYSE: BOT), a move that could advance ICE's unsolicited bid for the Chicago Board of Trade.
• Rather than focus on potential take-out targets, Barron's Online's "Weekday Trader" said that the smart bet for investors is to focus on companies with rising profits, cash flows and dividends, such as Loews Corp-Carolina Group (NYSE: CG) and Imperial Tobacco Group plc (NYSE: ITY), which boast free cash and dividends.

OTHER PAPERS:

• Best Buy Co Inc (NYSE: BBY) is in talks with Vivek for a "foray" into India, the Economic Times reported.
  
• The Washington Post reported that Nigeria filed criminal charges against Pfizer Inc (NYSE: PFE) over child deaths.

General Motors (GM) reported a net loss of $3.2 billion, or $5.62 per share this morning. This figure included one time charges for writing down announced costs associated with buyouts for almost a third of its factory employees. Excluding charges, GM posted a profit of $2.03 per share which easily topped estimates of $0.55 by analysts polled by Thomson Financial.

Total revenues for the second quarter rose to $54.4 billion from $48.5 billion as revenue from auto sales rose 11 percent to $45.2 billion from $40.4 billion. The company stated that global automotive operations, excluding charges, posted their first profit excluding charges since 2004.

GM has been enjoying a great year so far, mostly resulting from the massive reduction in it's workforce. But the company realizes that it needs to do more than just cut costs to keep the good times rolling.

"We know we have to develop and build great cars and trucks to grow our business and we're encouraged by the recent success of our newest vehicles, particularly in the U.S. market," GM Chairman and Chief Executive Rick Wagoner said. "Our newly launched vehicles will account for about 30 percent of our U.S. retail sales this year and grow to 40 percent next year."