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Citigroup Leads Financial Stocks and the Broad Market Higher
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Although US equity futures were higher in the pre-market today, the S&P 500 (INDEXSP:.INX) traded in a less than four-point range after the opening bell and through the entire session. Energy, tech, industrial, and financial stocks all led. Treasuries were lower through much of the day. The 10-year yield rose by three basis points to 2.545%. As such, utilities stocks were the weakest performer today. Gold prices were crushed as a large number of analysts reduced their forecasts for precious metals.

Citigroup (NYSE:C) reported second-quarter earnings before the market open. Earnings-per-share of $1.24 beat expectations of $1.05 handily. Revenues of $19.38 billion were also ahead of estimates of $18.81 billion. The stock was up 2.98% today and led the financial sector.

Executives said on the conference call that they see the bank's net-interest margin (NIM) stabilizing at current levels for the rest of the year now that its mortgage and Korea businesses have stabilized. The bank's NIM declined to 2.87% from 2.9% in the prior quarter. It also realized a 40% drop in its equity market revenue due to hedging activities associated with tensions in the Ukraine earlier in the quarter. Lastly, the bank finalized its agreement to pay a $7 billion settlement with the federal government for misleading investors about the quality of mortgage-backed securities sold during the financial crisis.

European bank stocks, especially those with lower ratings, were broadly higher thanks to stronger earnings from Citigroup in the pre-market. The holding company for Banco Espirito Santo (ELI:BES) sold 5% of its 25% stake in the bank in a privately-placed transaction that would allow it to repay a margin loan originally obtained to buy said stake. The bank's stock still lost 7.48% today.

Tomorrow's Financial Outlook

Tomorrow morning the US will release advance retail sales for June. Sales are expected to rise by 0.6% month-over-month after rising 0.3% in May. Same-store sales for June, as reported by Johnson Redbook, recorded their strongest month in five years. Auto sales also showed a similar amount of extraordinary strength, and many believe World Cup-related sales were a positive contributor throughout the month. However, the overall rate of sales growth was likely dragged down by a reduced increase -- or no increase -- in inflation. Janet Yellen will give the Fed's semi-annual Humphrey Hawkins testimony to the Senate Banking Committee starting at 10:00 a.m. EDT.

Overnight, the Bank of Japan will release its monthly monetary policy decision. The bank is expected to upgrade its economic assessment for the first time in six months, according to Nikkei newswire. Also scheduled for release overnight is the Reserve Bank of Australia's (RBA) minutes from its meeting earlier this month. The central bank took on a more dovish tone at the meeting, which was a mild surprise to most market participants. Investors will be examining the minutes to look for the reasoning behind the shift.

Tomorrow will be the first day when a substantial number of earnings reports are released. Notable reports include JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS), CSX (NYSE:CSX), Intel (NASDAQ:INTC), Yahoo (NASDAQ:YHOO), and Johnson & Johnson (NYSE:JNJ).


Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Citigroup Leads Financial Stocks and the Broad Market Higher
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Although US equity futures were higher in the pre-market today, the S&P 500 (INDEXSP:.INX) traded in a less than four-point range after the opening bell and through the entire session. Energy, tech, industrial, and financial stocks all led. Treasuries were lower through much of the day. The 10-year yield rose by three basis points to 2.545%. As such, utilities stocks were the weakest performer today. Gold prices were crushed as a large number of analysts reduced their forecasts for precious metals.

Citigroup (NYSE:C) reported second-quarter earnings before the market open. Earnings-per-share of $1.24 beat expectations of $1.05 handily. Revenues of $19.38 billion were also ahead of estimates of $18.81 billion. The stock was up 2.98% today and led the financial sector.

Executives said on the conference call that they see the bank's net-interest margin (NIM) stabilizing at current levels for the rest of the year now that its mortgage and Korea businesses have stabilized. The bank's NIM declined to 2.87% from 2.9% in the prior quarter. It also realized a 40% drop in its equity market revenue due to hedging activities associated with tensions in the Ukraine earlier in the quarter. Lastly, the bank finalized its agreement to pay a $7 billion settlement with the federal government for misleading investors about the quality of mortgage-backed securities sold during the financial crisis.

European bank stocks, especially those with lower ratings, were broadly higher thanks to stronger earnings from Citigroup in the pre-market. The holding company for Banco Espirito Santo (ELI:BES) sold 5% of its 25% stake in the bank in a privately-placed transaction that would allow it to repay a margin loan originally obtained to buy said stake. The bank's stock still lost 7.48% today.

Tomorrow's Financial Outlook

Tomorrow morning the US will release advance retail sales for June. Sales are expected to rise by 0.6% month-over-month after rising 0.3% in May. Same-store sales for June, as reported by Johnson Redbook, recorded their strongest month in five years. Auto sales also showed a similar amount of extraordinary strength, and many believe World Cup-related sales were a positive contributor throughout the month. However, the overall rate of sales growth was likely dragged down by a reduced increase -- or no increase -- in inflation. Janet Yellen will give the Fed's semi-annual Humphrey Hawkins testimony to the Senate Banking Committee starting at 10:00 a.m. EDT.

Overnight, the Bank of Japan will release its monthly monetary policy decision. The bank is expected to upgrade its economic assessment for the first time in six months, according to Nikkei newswire. Also scheduled for release overnight is the Reserve Bank of Australia's (RBA) minutes from its meeting earlier this month. The central bank took on a more dovish tone at the meeting, which was a mild surprise to most market participants. Investors will be examining the minutes to look for the reasoning behind the shift.

Tomorrow will be the first day when a substantial number of earnings reports are released. Notable reports include JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS), CSX (NYSE:CSX), Intel (NASDAQ:INTC), Yahoo (NASDAQ:YHOO), and Johnson & Johnson (NYSE:JNJ).


Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Citigroup Leads Financial Stocks and the Broad Market Higher
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Although US equity futures were higher in the pre-market today, the S&P 500 (INDEXSP:.INX) traded in a less than four-point range after the opening bell and through the entire session. Energy, tech, industrial, and financial stocks all led. Treasuries were lower through much of the day. The 10-year yield rose by three basis points to 2.545%. As such, utilities stocks were the weakest performer today. Gold prices were crushed as a large number of analysts reduced their forecasts for precious metals.

Citigroup (NYSE:C) reported second-quarter earnings before the market open. Earnings-per-share of $1.24 beat expectations of $1.05 handily. Revenues of $19.38 billion were also ahead of estimates of $18.81 billion. The stock was up 2.98% today and led the financial sector.

Executives said on the conference call that they see the bank's net-interest margin (NIM) stabilizing at current levels for the rest of the year now that its mortgage and Korea businesses have stabilized. The bank's NIM declined to 2.87% from 2.9% in the prior quarter. It also realized a 40% drop in its equity market revenue due to hedging activities associated with tensions in the Ukraine earlier in the quarter. Lastly, the bank finalized its agreement to pay a $7 billion settlement with the federal government for misleading investors about the quality of mortgage-backed securities sold during the financial crisis.

European bank stocks, especially those with lower ratings, were broadly higher thanks to stronger earnings from Citigroup in the pre-market. The holding company for Banco Espirito Santo (ELI:BES) sold 5% of its 25% stake in the bank in a privately-placed transaction that would allow it to repay a margin loan originally obtained to buy said stake. The bank's stock still lost 7.48% today.

Tomorrow's Financial Outlook

Tomorrow morning the US will release advance retail sales for June. Sales are expected to rise by 0.6% month-over-month after rising 0.3% in May. Same-store sales for June, as reported by Johnson Redbook, recorded their strongest month in five years. Auto sales also showed a similar amount of extraordinary strength, and many believe World Cup-related sales were a positive contributor throughout the month. However, the overall rate of sales growth was likely dragged down by a reduced increase -- or no increase -- in inflation. Janet Yellen will give the Fed's semi-annual Humphrey Hawkins testimony to the Senate Banking Committee starting at 10:00 a.m. EDT.

Overnight, the Bank of Japan will release its monthly monetary policy decision. The bank is expected to upgrade its economic assessment for the first time in six months, according to Nikkei newswire. Also scheduled for release overnight is the Reserve Bank of Australia's (RBA) minutes from its meeting earlier this month. The central bank took on a more dovish tone at the meeting, which was a mild surprise to most market participants. Investors will be examining the minutes to look for the reasoning behind the shift.

Tomorrow will be the first day when a substantial number of earnings reports are released. Notable reports include JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS), CSX (NYSE:CSX), Intel (NASDAQ:INTC), Yahoo (NASDAQ:YHOO), and Johnson & Johnson (NYSE:JNJ).


Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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