Continue reading Citigroup Outlook Raised, but J.P. Morgan Preferred

Citigroup Outlook Raised, but J.P. Morgan Preferred originally appeared on BloggingStocks on Mon, 19 Jul 2010 11:30:00 EST. Please see our terms for use of feeds.

Goldman Sachs (GS) analysts stated Monday that the recent market volatility is causing them to "reassess" their coverage on the financial sector.

According to MarketWatch, the brokerage house said: "The recent spike in volatility makes us more optimistic about capital markets activity like trading, but we are more cautious about the longer-term capital deployment theme, such as M&A, private equity, corporate loan growth and equity-fund lows." The list of moves is quite extensive, but one of the companies feeling the ire of Goldman is Janus Capital Group (JNS), which was cut to sell from neutral.

Continue reading Goldman Sachs Reassesses Financials

Goldman Sachs Reassesses Financials originally appeared on BloggingStocks on Mon, 24 May 2010 10:30:00 EST. Please see our terms for use of feeds.

Last week, JPMorgan Chase & Co. (JPM) led off the coming parade of earnings from the big banks when it reported better-than-expected fourth-quarter and full-year earnings, though its revenue fell short of estimates.

Plenty more earnings from the financial sector are due out this week. Analysts surveyed by Thomson Reuters anticipate fourth-quarter earnings growth from American Express Co. (AXP), Bank of New York Mellon Corp. (BK), Hudson City Bancorp Inc. (HCBK), SLM Corp. (SLM) and US Bancorp (USB).

Continue reading The Week in Preview: Q4 Earnings Expectations for the Financial Sector

The Week in Preview: Q4 Earnings Expectations for the Financial Sector originally appeared on BloggingStocks on Sun, 17 Jan 2010 12:30:00 EST. Please see our terms for use of feeds.

"The effect of this capital assessment will be to help replace uncertainty with transparency. ... We chose a strategy to lift the fog of uncertainty over bank balance sheets and to help ensure that the major banks, individually and collectively, had the capital to continue lending even in a worse-than-expected recession." -- Treasury Secretary Timothy Geithner, May 2009

These tests did NOT bring transparency to the banking sector. They were practically designed to prove the banks were fine, and simply ignored off-balance-sheet and other dodgy assets. It was as if they were saying, "We will do whatever it takes (even lie) to make sure the big banks do not fail since Congress won't give us more money to fix them."

Continue reading Lie #1: The Stress Tests Provided Transparency in the Banks

Lie #1: The Stress Tests Provided Transparency in the Banks originally appeared on BloggingStocks on Sat, 26 Dec 2009 10:00:00 EST. Please see our terms for use of feeds.

Continue reading JPMorgan slashes earnings estimates on major banks

JPMorgan slashes earnings estimates on major banks originally appeared on BloggingStocks on Tue, 01 Dec 2009 09:20:00 EST. Please see our terms for use of feeds.

Continue reading JPMorgan Chase crushes third-quarter earnings forecast

JPMorgan Chase crushes third-quarter earnings forecast originally appeared on BloggingStocks on Wed, 14 Oct 2009 08:30:00 EST. Please see our terms for use of feeds.

Much like Goldman Sachs, BlackRock (NYSE: BLK) is a financial company that's delivered big gains for its shareholders over the past five years. In fact, BLK shares are up 188% over the past five years. More recently, the company's shares are up over 50% in the past six months.

BlackRock is an asset management firm that provides portfolio management services to corporate and public pension plans. It also manages pension funds for insurance companies, mutual funds, endowments, and private foundations. You might say that BlackRock is the money manager of choice if you've got a really big pension fund in need of the best money managers around.

Continue reading Real bargain stock #6: BlackRock (BLK)

Real bargain stock #6: BlackRock (BLK) originally appeared on BloggingStocks on Sun, 04 Oct 2009 09:00:00 EST. Please see our terms for use of feeds.

What can you say about this crown jewel of brokerage and investment banks that hasn't already been said?

Goldman Sachs (NYSE: GS) is, by far, the most prestigious, as well as the most politically-connected, bank on Wall Street. Its success over both the fat years and the lean years has been difficult to ignore.

So it's no wonder then that shares of this iconic financial giant are up nearly 100% over the past five years, while stocks that comprise the Dow Jones Financial Services index were down 11% over those same five years.

Continue reading Real bargain stock #4: Goldman Sachs (GS)

Real bargain stock #4: Goldman Sachs (GS) originally appeared on BloggingStocks on Sat, 03 Oct 2009 13:00:00 EST. Please see our terms for use of feeds.

Are financial stocks a buy now? Jeffrey Palma, a strategist for UBS says yes. He is recommending a modest "overweight" for this sector. He goes on to say that financials had the biggest gains among 10 industry groups in the MSCI World Index in the second quarter.

Let's be clear here. Mr. Palma is referring to the second quarter. The second quarter is done, finished. The real question is whether or not, going forward, the rally will continue.

Continue reading Are financial stocks still a buy?

Are financial stocks still a buy? originally appeared on BloggingStocks on Wed, 01 Jul 2009 12:20:00 EST. Please see our terms for use of feeds.

Buying the financials while the Fed was aggressively cutting interest rates was supposed to be a no-brainer.

Banks, brokerages, insurance companies and other financial-related businesses rally in tandem to lower rates, which translates into cheap money for lending and investing.

A million and one professionals bought into this theme, and made the mistake of thinking the worst-case scenario for the credit markets was baked in back in June.

By mid-July, the bloodletting in the financial sector revealed giant writedowns being charged against earnings for huge exposure to subprime debt at the biggest banks and Wall Street firms. The rest is history, which is still being written to date.

Shares of Citigroup (NYSE: C) crashed from $25 to $3, Goldman Sachs (NYSE: GS) plunged from $180 to $47, and Bank of America (NYSE: BAC) fell from $40 to $10. You get the picture.

Continue reading 2008 Trades Gone Bad #4: Betting on the financials

2008 Trades Gone Bad #4: Betting on the financials originally appeared on BloggingStocks on Thu, 25 Dec 2008 14:00:00 EST. Please see our terms for use of feeds.

Continue reading Warren Buffett's picks beat S&P 500's Financial Index in Q3

Warren Buffett's picks beat S&P 500's Financial Index in Q3 originally appeared on BloggingStocks on Wed, 26 Nov 2008 14:50:00 EST. Please see our terms for use of feeds.

The US markets did have a furious rally, rising 11% on major indexes. Overnight, Japan's Nikkei was up over 14%. The move to put money into banks and credit markets appears to be working.

But, don't forget the recession, which many economists see lasting longer than any downturn since 1974. Unemployment went to nearly 9% then. That is about 50% higher than the current 6.1% rate.

Yesterday, General Motors Corporation (NYSE:GM) said it would cut production more. Who would be surprised if the auto industry cut more jobs? The financial sector has lost tens of thousand of jobs, and as bank mergers go through, that is likely to go up sharply.

If there is on element which could pull the stock market back down, it is the realization that the economy is getting much, much worse and that corporate earnings will suffer accordingly.

A new wave of data about the economy will be coming soon. According to The Wall Street Journal, "The biggest data point is: the Census Bureau's retail sales report for September, on Wednesday. Economists expect sales tumbled for the third straight month, led by abysmal auto sales."

Investors who pour their money back into the market now, do so at their own peril. Don't forget the recession.

Douglas A. McIntyre is an editor at 247wallst.com.

Don't forget the recession, and automakers' upcoming cuts originally appeared on BloggingStocks on Tue, 14 Oct 2008 10:31:00 EST. Please see our terms for use of feeds.

Baudouin Prot , CEO of one of Europe's largest and best run banks, BNP Paribas (OTC:BNPQY), said that he believes that the worst of the subprime mess is behind us. What makes this statement important is that BNP is one of the few major banks not to take a serious hit from subprime. The bank estimates that their exposure to subprime is minimal this year and was only about 200 million Euro in '07.

In a Marketwatch report, Prot says: "There are no doubts the crisis isn't over. However, the worst should be over and I believe that in the second semester the crisis may normalize."

While I am skeptical of any bank CEO telling me that the worst is behind us, as they certainly have their own agenda of keeping their stock prices up, when the CEO of a bank that has had little exposure to the crisis tells me that he thinks the tide is turning, I would listen. After all he has an interest in watching some of his competitors fall further, as he could then swoop in and buy on the cheap. The fact that he isn't talking down the industry means that he truly thinks that we are beginning to see the light at the end of the tunnel.

No one seems ready to call a bottom in the financial sector, but with this report, investors may want to start researching the financials that are in the best shape, as we may potentially be near a bottom.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 6/29/08.

Finanical crisis: BNP head thinks worst behind us originally appeared on BloggingStocks on Mon, 30 Jun 2008 08:50:00 EST. Please see our terms for use of feeds.

The stock market was down without much conviction in the early going with the DJIA off 40 to 50 points. But someone must have pulled the plug somewhere as it has been dropping fast from about 2 p.m. and the Dow was down over 180 points as I pecked away at the keyboard.

What the heck changed overall market sentiment so suddenly? Some say it's oil prices drifting higher. That's always a good scapegoat and probably has something to do with it. It might also be a connected issue with the raging conflicts in the middle east and Africa.

There is always the negative sentiment about housing, employment, last night's democratic primaries in Indiana and North Carolina just muddling on. It might also be our current president just muddling on, or it might just be that all of these things just prompted some profit taking after weeks of appreciation.

Maybe it is my pal Warren's negative sentiment about the financial sector and the years of pain that may still need to be worked out of the system. Whatever it is you can be sure that after the market closes the Wall Street pundits will discuss all their presumptions as if they were facts...

UPDATE: The DJIA closed at 12,814.35 down -206.48, or -1.59%

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money.

Who pulled the plug on the DOW? originally appeared on BloggingStocks on Wed, 07 May 2008 15:10:00 EST. Please see our terms for use of feeds.

"The Warren Buffet related Muni-Bond insurance plan was a positive catalyst," notes options and market timing expert Larry McMillan in The Daily Strategist. Here, he looks at the overall market and some select buy signals in individual stocks.

"The multiple re-tests of the support area around 1310-1320 has inspired confidence as buyers have emerged. And the S&P 500 Index has been able to stage a strong rally above the 1350 level in the interim. This is a first positive step.

"Sector support behind the rally remains primarily in the Energy sector: however, the Financial sector has joined in somewhat. A continuation of these sectors rallying in concert would bode well for a continuation of he current rally.

Continue reading McMillan: Timer sees 'first step' to buy signal

McMillan: Timer sees 'first step' to buy signal originally appeared on BloggingStocks on Wed, 13 Feb 2008 12:06:00 EST. Please see our terms for use of feeds.

The S&P 500 would be doing OK if it weren't for the total number and performance of financial stocks in the index.

Some 60% of the companies in the S&P that have reported fourth-quarter profits have beat estimates. But the companies that missed, mostly financial firms, have missed by so much, that it drags down the average profit of the pool overall.

According to the Associated Press, "Losses from financial players like Citigroup Inc., Bear Stearns Cos., and Merrill Lynch & Co. wiped about $61 billion from the S&P 500's overall profit during the fourth quarter."

In an odd way, this is good news. It means that the industries outside the financial sector are holding up relatively well. That indicates that employment in these parts of the economy may end up in relatively good shape. Capital spending may not be hurt as badly as some Wall Street analysts fear.

If much of the damage to the markets and corporate America stays isolated to the financials, the country could avoid a recession.

Douglas A. McIntyre is an editor at 247wallst.com.

S&P 500 back broken by financial stocks originally appeared on BloggingStocks on Sun, 03 Feb 2008 12:10:00 EST. Please see our terms for use of feeds.