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Bank Stocks Lead After Short-Term Interest Rates Rise
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Asian markets largely reacted negatively to the poor performance by US markets at the close of trading yesterday. China's yuan posted its largest single-day decline for the past six years in today's session, losing 0.50%. On the other hand, Latin American markets rallied strongly today with Brazil's Ibovespa (INDEXBVMF:IBOV) breaking out of a six-month downtrend.

US markets attempted to sell off to start the day, but they made a strong comeback after the early weakness to see the S&P 500 (INDEXSP:.INX) close up 0.60%. Bank and telecom stocks led, while the rate-sensitive real-estate and utility sectors lagged. Investors bought bank stocks due to the sharp increase in short-term interest rates yesterday. Banks will be able to capture higher net interest margins as these rates rise because their funding rates will remain near zero for the rest of the year. The S&P Bank Index (INDEXSP:BKX) rose 2.51% today, making it the strongest sector. US Treasuries remained largely unchanged after a very heavily traded session.

Despite the Nasdaq's (INDEXNASDAQ:.IXIC) finish in the green, there were some clear negatives under the surface. The index itself finished well off its intraday high, while market leaders Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) were both down. Also, biotech, social media, and 3-D printing stocks looked ugly, underperforming the major averages by wide margins.

The March Philadelphia manufacturing index showed a surprise advance to 9.0 after -6.3 last month. The index's components showed strong growth in new orders, production, and positive movement in unfilled orders. February existing home sales declined to an annual rate of 4.6 million from 4.62 million in the month prior. This was in line with what economists had been expecting.

Tomorrow's Financial Outlook

There will be no major economic reports tomorrow morning in the US. However, four separate Fed governors will make speeches throughout the afternoon. After the market's reaction yesterday to Chair Janet Yellen's comment that the central bank would begin increasing rates six months following the completion of its asset purchase program, it is extremely likely that these speeches will be used to assuage investors' fears.

Two data reports are due out tomorrow from Canada: its retail sales and consumer price index. Consumer price growth is expected to slow in February to 1.0% from a year ago, down from 1.5% in January. The other data report of note is the March advance estimate of eurozone consumer confidence.

The only notable earnings reports scheduled for tomorrow morning are Darden Restaurants (NYSE:DRI) and Tiffany (NYSE:TIF).

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.

Bank Stocks Lead After Short-Term Interest Rates Rise
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Asian markets largely reacted negatively to the poor performance by US markets at the close of trading yesterday. China's yuan posted its largest single-day decline for the past six years in today's session, losing 0.50%. On the other hand, Latin American markets rallied strongly today with Brazil's Ibovespa (INDEXBVMF:IBOV) breaking out of a six-month downtrend.

US markets attempted to sell off to start the day, but they made a strong comeback after the early weakness to see the S&P 500 (INDEXSP:.INX) close up 0.60%. Bank and telecom stocks led, while the rate-sensitive real-estate and utility sectors lagged. Investors bought bank stocks due to the sharp increase in short-term interest rates yesterday. Banks will be able to capture higher net interest margins as these rates rise because their funding rates will remain near zero for the rest of the year. The S&P Bank Index (INDEXSP:BKX) rose 2.51% today, making it the strongest sector. US Treasuries remained largely unchanged after a very heavily traded session.

Despite the Nasdaq's (INDEXNASDAQ:.IXIC) finish in the green, there were some clear negatives under the surface. The index itself finished well off its intraday high, while market leaders Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) were both down. Also, biotech, social media, and 3-D printing stocks looked ugly, underperforming the major averages by wide margins.

The March Philadelphia manufacturing index showed a surprise advance to 9.0 after -6.3 last month. The index's components showed strong growth in new orders, production, and positive movement in unfilled orders. February existing home sales declined to an annual rate of 4.6 million from 4.62 million in the month prior. This was in line with what economists had been expecting.

Tomorrow's Financial Outlook

There will be no major economic reports tomorrow morning in the US. However, four separate Fed governors will make speeches throughout the afternoon. After the market's reaction yesterday to Chair Janet Yellen's comment that the central bank would begin increasing rates six months following the completion of its asset purchase program, it is extremely likely that these speeches will be used to assuage investors' fears.

Two data reports are due out tomorrow from Canada: its retail sales and consumer price index. Consumer price growth is expected to slow in February to 1.0% from a year ago, down from 1.5% in January. The other data report of note is the March advance estimate of eurozone consumer confidence.

The only notable earnings reports scheduled for tomorrow morning are Darden Restaurants (NYSE:DRI) and Tiffany (NYSE:TIF).

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.

More From Minyanville Staff
Bank Stocks Lead After Short-Term Interest Rates Rise
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

Asian markets largely reacted negatively to the poor performance by US markets at the close of trading yesterday. China's yuan posted its largest single-day decline for the past six years in today's session, losing 0.50%. On the other hand, Latin American markets rallied strongly today with Brazil's Ibovespa (INDEXBVMF:IBOV) breaking out of a six-month downtrend.

US markets attempted to sell off to start the day, but they made a strong comeback after the early weakness to see the S&P 500 (INDEXSP:.INX) close up 0.60%. Bank and telecom stocks led, while the rate-sensitive real-estate and utility sectors lagged. Investors bought bank stocks due to the sharp increase in short-term interest rates yesterday. Banks will be able to capture higher net interest margins as these rates rise because their funding rates will remain near zero for the rest of the year. The S&P Bank Index (INDEXSP:BKX) rose 2.51% today, making it the strongest sector. US Treasuries remained largely unchanged after a very heavily traded session.

Despite the Nasdaq's (INDEXNASDAQ:.IXIC) finish in the green, there were some clear negatives under the surface. The index itself finished well off its intraday high, while market leaders Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) were both down. Also, biotech, social media, and 3-D printing stocks looked ugly, underperforming the major averages by wide margins.

The March Philadelphia manufacturing index showed a surprise advance to 9.0 after -6.3 last month. The index's components showed strong growth in new orders, production, and positive movement in unfilled orders. February existing home sales declined to an annual rate of 4.6 million from 4.62 million in the month prior. This was in line with what economists had been expecting.

Tomorrow's Financial Outlook

There will be no major economic reports tomorrow morning in the US. However, four separate Fed governors will make speeches throughout the afternoon. After the market's reaction yesterday to Chair Janet Yellen's comment that the central bank would begin increasing rates six months following the completion of its asset purchase program, it is extremely likely that these speeches will be used to assuage investors' fears.

Two data reports are due out tomorrow from Canada: its retail sales and consumer price index. Consumer price growth is expected to slow in February to 1.0% from a year ago, down from 1.5% in January. The other data report of note is the March advance estimate of eurozone consumer confidence.

The only notable earnings reports scheduled for tomorrow morning are Darden Restaurants (NYSE:DRI) and Tiffany (NYSE:TIF).

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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