Tumbling banks hold back stock market
NEW YORK — Bank stocks buckled on Friday, even after several reported fatter profits than analysts expected, and the sharp declines overshadowed gains elsewhere in the market to drag the S&P 500 lower.
JPMorgan Chase and several other financial titans marked the unofficial start of the earnings reporting season, and expectations were high for them, as they are for most major companies. Wall Street is forecasting the strongest growth in seven years for S&P 500 companies, and the hope has been that healthy profit reports in coming weeks will steady the market following a rough couple of months.
But high expectations can be as much a burden as cause for optimism.
JPMorgan Chase reported its biggest-ever profit and topped analysts' expectations.
But investors were already anticipating the good news that it delivered, such as healthier trading revenue, and took note of things like an increase in charge-offs for credit cards.
JPMorgan Chase's shares fell 2.7 percent to $110.30 to lop off most of the big gains it had made earlier in the week.
As a group, financial stocks in the S&P 500 fell 1.6 percent, more than double the loss for any of the other 10 sectors that make up the index.
Expectations for profit growth this year may have climbed so high, particularly following Washington's recent overhaul of the tax code, that they may be setting the stage for future disappointment, said Matthew Watson, portfolio manager at James Investment Research.
Increased dividends
BP Prudhoe Bay Royalty Tr 1.27484 from 1.23015
Enterprise Pdts Partners .4275 from .425
First Republic Bank .18 from .17
Genesis Energy .52 from .51
Gladstone Investment .067 from .065 Greenbrier .25 from .23 H.B. Fuller Co .155 from .15
Lakeland Financial .26 from .22
MV Oil Trust .365 from .22
Procter&Gamble .7172 from .6896
Special dividends Gladstone Invest .06
Stock dividends Bank of South Carolina 10pc Stock splits this week
Turtle Beach 1-for-4 reverse split
Acquisitions and mergers
Dynegy-Vistra Energy Corp. (1.74B)
Ply Gem HoldingsClayton Dubilier and Rice (2.4B)
New stock listings
Nasdaq Global and Global Select Markets
Business First Bancshares
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