We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Bank Stock Roundup: JPM, WFC & C in Focus on Business Restructuring Initiatives
Read MoreHide Full Article
Over the past five trading sessions, the performance of major bank stocks has depicted a bearish stance as the rate on the 10-year Treasury bond have fallen from its highs in the prior week. Rising coronavirus cases in Europe and renewed lockdown announcement in several places hurt investor sentiments.
Despite the fall in yields, the rate on the 10-year Treasury bond stands at 1.63%, while that for the 30-year Treasury bond is 2.35%. Thus, the steepening yield curve is expected to benefit major banks’ net interest margins amid a low interest rate environment.
With banks’ financials directly tied to the health of the economy, investors are now expecting improved profitability for major banks in the quarters ahead.
Additionally, the Federal Reserve has announced that “additional restrictions on bank holding company dividends and share repurchases” will be lifted after Jun 30 following the completion of this year’s stress test.
Now talking about bank-specific developments, major banks continued with the business restructuring initiatives over the past five trading sessions. These efforts are expected to further support banks’ profitability over time.
1. JPMorgan’s (JPM - Free Report) asset-management unit – J.P. Morgan Asset Management – plans to buy a 10% stake in China Merchants Bank Co.’s wealth management subsidiary. While the deal is yet to receive regulatory approval, the company is expected to pay nearly $410 million for obtaining the minority stake.
2. Wells Fargo (WFC - Free Report) has inked a deal to divest its Corporate Trust Services business to Australia-based Computershare Limited for $750 million. This is in line with the company’s strategy of concentrating on businesses core to its consumer and corporate client base. The transaction, likely to close in the first half of 2021, is subject to customary closing conditions.
3. Citigroup (C - Free Report) has entered into partnership with Sharegain, a capital markets fintech firm, to introduce its first fully automated securities lending solution for clients availing custodial services. The new solution has been developed in a manner that makes its integration with wealth managers’ existing IT infrastructure possible. Also, clients will be able to witness a fully digital experience, from enrolment in the program through managing their lending, with this solution.
Price Performance
Here is how the seven major stocks performed:
Company
Last Week
6 months
JPM
-1.7%
65.9%
BAC
-2.3%
62.1%
WFC
-0.8%
67.5%
C
-1.8%
74.3%
COF
1.1%
85.2%
USB
-0.6%
59.4%
PNC
0.7%
71.7%
Over the past five trading days, Bank of America (BAC - Free Report) and Citigroup have recorded the maximum loses, with their shares falling 2.3% and 1.8%, respectively. However, shares of Capital One (COF - Free Report) have rallied 1.1% during the same period.
Over the past six months, shares of Capital One have jumped 85.2%, while Citigroup and PNC Financial (PNC - Free Report) have surged 74.3% and 71.7%, respectively.
What’s Next?
Over the next five trading days, unless there is any major change in the economic situation, the major bank stocks are likely to perform in a similar fashion.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
Image: Bigstock
Bank Stock Roundup: JPM, WFC & C in Focus on Business Restructuring Initiatives
Over the past five trading sessions, the performance of major bank stocks has depicted a bearish stance as the rate on the 10-year Treasury bond have fallen from its highs in the prior week. Rising coronavirus cases in Europe and renewed lockdown announcement in several places hurt investor sentiments.
Despite the fall in yields, the rate on the 10-year Treasury bond stands at 1.63%, while that for the 30-year Treasury bond is 2.35%. Thus, the steepening yield curve is expected to benefit major banks’ net interest margins amid a low interest rate environment.
With banks’ financials directly tied to the health of the economy, investors are now expecting improved profitability for major banks in the quarters ahead.
Additionally, the Federal Reserve has announced that “additional restrictions on bank holding company dividends and share repurchases” will be lifted after Jun 30 following the completion of this year’s stress test.
Now talking about bank-specific developments, major banks continued with the business restructuring initiatives over the past five trading sessions. These efforts are expected to further support banks’ profitability over time.
(Read: Bank Stock Roundup for the Week Ending Feb 26, 2021)
Important Developments of the Week
1. JPMorgan’s (JPM - Free Report) asset-management unit – J.P. Morgan Asset Management – plans to buy a 10% stake in China Merchants Bank Co.’s wealth management subsidiary. While the deal is yet to receive regulatory approval, the company is expected to pay nearly $410 million for obtaining the minority stake.
2. Wells Fargo (WFC - Free Report) has inked a deal to divest its Corporate Trust Services business to Australia-based Computershare Limited for $750 million. This is in line with the company’s strategy of concentrating on businesses core to its consumer and corporate client base. The transaction, likely to close in the first half of 2021, is subject to customary closing conditions.
3. Citigroup (C - Free Report) has entered into partnership with Sharegain, a capital markets fintech firm, to introduce its first fully automated securities lending solution for clients availing custodial services. The new solution has been developed in a manner that makes its integration with wealth managers’ existing IT infrastructure possible. Also, clients will be able to witness a fully digital experience, from enrolment in the program through managing their lending, with this solution.
Price Performance
Here is how the seven major stocks performed:
Company
Last Week
6 months
JPM
-1.7%
65.9%
BAC
-2.3%
62.1%
WFC
-0.8%
67.5%
C
-1.8%
74.3%
COF
1.1%
85.2%
USB
-0.6%
59.4%
PNC
0.7%
71.7%
Over the past five trading days, Bank of America (BAC - Free Report) and Citigroup have recorded the maximum loses, with their shares falling 2.3% and 1.8%, respectively. However, shares of Capital One (COF - Free Report) have rallied 1.1% during the same period.
Over the past six months, shares of Capital One have jumped 85.2%, while Citigroup and PNC Financial (PNC - Free Report) have surged 74.3% and 71.7%, respectively.
What’s Next?
Over the next five trading days, unless there is any major change in the economic situation, the major bank stocks are likely to perform in a similar fashion.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>