Financials Down With Treasury Rates Despite Strong Earnings - Financials Roundup
January 17 2017 - 5:04PM
Dow Jones News
Banks, lenders and other financial companies fell sharply --
despite another round of strong earnings -- as interest rates slid.
Recent comments from President-elect Donald Trump about trade and
the dollar have caused traders to back off predictions of what the
president elect's economic policy will look like. As a consequence,
the run-up in Treasury yields -- and stocks -- has stalled. One
brokerage said the postelection rally could resume later in the
year, however. "The bullish sweet spot of Presidential Cycle Year 1
is March-July, which has an average gain of 7.86% (average
March-August rally of 11.15% for a first term President)," said
analysts at Bank of America Merill Lynch Global Research. "This
fits with the potential for a 10% melt-up in stocks and commodities
in the first half of 2017" after "wobbles" in January and February.
Morgan Stanley posted its best fourth-quarter results since the
financial crisis, helped by increased activity on its trading desks
and for its army of financial advisers. But shares of the bank and
other strong earners fell in a reaction that Carter Worth, chief
market technician for research firm Cornerstone Macro called
"classic...buy the rumor, sell the news" trading.
-Rob Curran, rob.curran@dowjones.com
(END) Dow Jones Newswires
January 17, 2017 16:49 ET (21:49 GMT)
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