Stocks were essentially flat today as riots in Greece turned violent pending a vote by the Greek Parliament on becoming essentially a southern German state. The Dow closed off 3 points on heavy trading volume at 18,050. Bank stocks were leaders today along with biotech.
Lawyers took a hit as Bank of America reported earnings which significantly outperformed analyst estimates thanks to a huge drop in legal costs. Last year’s Q2 saw B of A play a game of “whip out” (as in “whip out the wallet”) with lawyers to the tune of $4 billion in legal costs and this quarter that figure dropped to $175 million. The bank reported 6% growth in deposits, a whopping 40% growth in residential mortgage originations and growth in tier 1 capital to 11.2% up a tenth. The bottom line number came in at 45 cents per share up 137% from Q2 last year and beating estimates by a wide margin. Top line numbers also showed an increase of about 2%. Management said they felt that operations were progressing towards a more normal operating environment. Wall Street liked the news and sent shares higher.
US Bank also reported earnings which, while tepid, were enough to propel shares higher. The bank saw its revenue fall by 2.8% while net income grew by 3%. Total loan volume was up 4% with commercial loans leading the way posting an 11% increase.
Federal Reserve Chair Janet Yellen visited Capitol Hill (or is that capital hill?) today and during testimony stated that she is on track to raise interest rates later this year just so long as the economy stays stable and the labor market continues to improve.
Have a good evening.
William R. Dunnell
Greystone Financial & Estate Services, Inc.
Securities & Advisory Services offered through KMS Financial Services, Inc.
Member FINRA – SIPC
William R. Dunnell
Greystone Financial and Estate Services, Inc. 1216 NW 75th St Seattle, WA 98117
1-800-692-2140, Securities offered through KMS Financial Services, Inc. Seattle WA Member FIINRA/SIPC
The thoughts in this email are personal impressions regarding events and trends that I see in the markets and the economy. These impressions are gathered from sources that I believe to be reliable but even so they may contain inaccuracies and therefore should be taken with a grain of salt. This email is primarily meant to enhance and encourage communication and is not intended to be a buy or sell recommendation. I encourage you to call me at 1800-692-2140 if you have any questions or comments.