30/09/2014 09:51:44 Free Membership Login

Ahead of Wall Street - June 22, 2012 - Ahead of Wall Street

Date : 06/22/2012 @ 4:49AM
Source : Zacks
Stock : Bank of America Corp. (BAC)
Quote : 17.06  0.05 (0.29%) @ 9:36AM
Bank of America share price Chart

Ahead of Wall Street - June 22, 2012 - Ahead of Wall Street

Friday, June 22, 2012

Relief at the lower than expected downgrades of major banks by a rating agency is expected to be a key factor in today’s trading action, as the data docket is otherwise on the thin side. In headlines out of Europe this morning, German business confidence is materially down, highlighting that the country is not immune from all the negative cross-currents in its vicinity. Concerns about global growth have taken center stage, causing the sharp sell-off on Thursday, and are likely to replace today’s temporary bank-related positive momentum.     

Moody’s came through with its long-standing downgrade threat, by lowering its ratings on more than a dozen global banks, including five of the biggest U.S. banks. U.S. banks that suffered downgrades of two notches each included Morgan Stanley (MS – from A2 to Baa1), Goldman Sachs (GS – from A1 to A3), Citi (C – from A3 to Baa2), and J.P. Morgan (JPM – from Aa3 to A2), while Bank of America (BAC) was lowered by one notch – from Baa1 to Baa2).

The downgrades will no doubt result in additional direct expenses through additional collateral requirements and the need to make termination payments. But they turned out to be less severe than the market had been expecting. As such, we will likely see bank stocks move up in relief that the news could have been much worse. Some may even say that rating changes don’t matter anymore, but that is not entirely accurate - they do matter, particularly for banks.
 
In corporate news, Darden Restaurant (DRI) came out with in-line earnings on modestly lower top-line numbers. The operator of Oliver Garden and Red Lobster also announced a 16% increase in quarterly dividend. We also got a negative pre-announcement from Ryder Systems (R), the truck leading company, citing a lower demand environment. In other news, Monster Beverages (MNST) joins the S&P 500, replacing Sara Lee (SLE), after the market’s close on June 28th. On that date, Sara Lee will complete the spin-off of its international tea and coffee business and will get renamed to Hillshire Brands (it will have a new ticker – HSH).

Sheraz Mian
Director of Research


 
BANK OF AMER CP (BAC): Free Stock Analysis Report
 
DARDEN RESTRNT (DRI): Free Stock Analysis Report
 
GOLDMAN SACHS (GS): Free Stock Analysis Report
 
JPMORGAN CHASE (JPM): Free Stock Analysis Report
 
MONSTER BEVERAG (MNST): Free Stock Analysis Report
 
MORGAN STANLEY (MS): Free Stock Analysis Report
 
RYDER SYS (R): Free Stock Analysis Report
 
SARA LEE (SLE): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research
 
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Bank of America (NYSE:BAC)
Historical Stock Chart

1 Year : From Sep 2013 to Sep 2014

Click Here for more Bank of America Charts.

Bank of America (NYSE:BAC)
Intraday Stock Chart

Today : Tuesday 30 September 2014

Click Here for more Bank of America Charts.


Your Recent History
LSE
GKP
Gulf Keyst..
LSE
QPP
Quindell
FTSE
UKX
FTSE 100
LSE
IOF
Iofina
FX
GBPUSD
UK Sterlin..
Stocks you've viewed will appear in this box, letting you easily return to quotes you've seen previously.

Register now to create your own custom streaming stock watchlist.

NYSE and AMEX quotes are delayed by at least 20 minutes.
All other quotes are delayed by at least 15 minutes unless otherwise stated.

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

1 site:2 us 140930 09:51