Stocks today gained ground on weak trading volume to close up 39 points to 18,138. For the week the Dow lost about one half of a percentage point or roughly 101 points. Janet Yellen and other members of the Federal Reserve gave speeches today indicating that a small rate hike might occur in December but stressed the need for more aggregate demand in the economy in addition to low unemployment rates before more rate hikes.
It was a big day for earnings reports in the banking sector as Wells Fargo, Citi and JP Morgan Chase all reported Q3 numbers before the opening bell. Here is how they did:
Wells Fargo managed to beat estimates by posting a 4% revenue rise and a 2% decline in profits. The bank is under pressure as the CEO has bolted and a reorg is underway to clear the decks after the recent scandal. Of interest was a 30% drop in new credit card accounts being opened along with 25% decline in new checking accounts. Shares were lower.
Citigroup reported a 3% decline in sales and a 5% decline in profits but these results were much better than expected as strength in bond trading operations generated big bucks for the company.
The topper of all three was JP Morgan Chase. CEO Jamie Dimon is probably the most “needed” banker in the globe today as his bank is so flush that even Italy is asking him to help devise a rescue plan for its struggling financial sector. JP posted a revenue gain of 10% and profits were hotter than a Samsung Galaxy 7 as the bottom line grew by 20%. Shares were higher.
Bank of America reports earnings on Monday but the above results show that US banks are in good shape.