
U.S. stock investors, despite finding few areas of the market that appear cheap with indexes near records, appear reluctant to jump into what could be the biggest bargain out there, Reuters reported.
By many metrics, bank stocks appear to trade at a discount, and are expected to benefit from broad economic growth and interest rate hikes. Yet caution has prevailed over the group, and that could persist next week if investors continue dumping cyclical names for defensive positions, or if the September payroll report suggests the Federal Reserve could delay the first rate hike.
That first rate increase is expected in the second half of 2015, though the specific timing remains unknown. Higher rates are seen translating to higher net interest margins (NIMs), which have been low for major names. Bank of America, Citigroup and JPMorgan Chase all have NIMs below the industry medium of 3.6 percent.
The outlook for NIMs is a bit clouded, as the first rate hike will be preceded by the end of the Fed's bond-buying program, which is expected to result in a flattening of the yield curve. Banks tend to see higher profits under steeper curves, and a flattening could depress NIMs before the first hike.
GMT 15:13 2018 Saturday ,20 January
US 'erred' in supporting WTO membership for China, RussiaGMT 17:22 2018 Thursday ,18 January
US industrial output in 2017 posts biggest gain since 2010GMT 17:12 2018 Thursday ,18 January
No more bonuses for Carillion bosses after UK collapseGMT 17:20 2018 Wednesday ,17 January
EU to remove Panama, South Korea from tax haven blacklistGMT 17:16 2018 Wednesday ,17 January
Citigroup reports steep Q4 losses tied to US tax reformGMT 17:11 2018 Wednesday ,17 January
Pressure rises on British govt over Carillion collapseGMT 17:52 2018 Monday ,15 January
Iran jetliner deal could take longer to complete, Airbus saysGMT 17:44 2018 Monday ,15 January
EU to remove Panama, Korea, UAE, 5 others from tax haven blacklist
Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2025 ©
Maintained and developed by Arabs Today Group SAL.
All rights reserved to Arab Today Media Group 2025 ©
Send your comments
Your comment as a visitor