Bank Stock Roundup: Markets In Correction Mode, Wells Fargo Dominates Headlines
Zacks Investment Research | Feb 09, 2018 02:13AM ET
Stock market correction seems to be in the offing as over the last five trading days extreme volatility was witnessed. The banking stocks are not untouched by this.
It all started last Friday when January job and wage data was released. Needless to say, wages grew at the fastest pace last month in more than eight-and-a-half years. Though this indicates an improving economy, it raised fears of rise in inflation, in turn, reinforcing assumptions of a more aggressive stance by the Fed in hiking rates.
Additionally, a two-year budget deal announced by top senators will likely further strengthen the economy, thus giving the Fed all the more reason to raise rates. This also drove up the bond yields.
While indications of an improving economy and expectations for a more hawkish Fed stance are beneficial for banks on the whole, overall markets seem to be wary of such a scenario.
Coming to company-specific news related to banks, Wells Fargo (NYSE:WFC) dominated the headlines for all the wrong reasons. Its business mishandlings continue to hurt.
(Read: Citi Expects Investment Banking to Grow in Emerging Markets )
Price Performance
Here is how the seven major stocks performed:
Company | Last Week | 6 months |
JPM | -5.6% | 16.4% |
BAC | -6.9% | 20.6% |
WFC | -13.5% | 6.5% |
C | -6.7% | 5.2% |
COF | -9.2% | 8.3% |
USB | -7.5% | 0.1% |
PNC | -5.4% | 14.1% |
Get The News You Want
In the last five trading sessions, Wells Fargo and Capital One Financial (NYSE:COF) Corporation (NYSE:C) were the major losers, with their shares plunging 13.5% and 9.2%, respectively. Further, U.S. Bancorp (NYSE:USB) tanked 7.5%.
Bank of America (NYSE:C) and JPMorgan (NYSE:JPM) were the best performers over the last six months, with their stock prices rallying 20.6% and 16.4%, respectively. Also, shares of PNC Financial (NYSE:PNC) rose 14.1%.
What’s Next?
As investors are expected to continue booking profits, banks’ performance is likely to remain volatile over the next five trading days.
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