U.S. bank stocks ride on a high in recent trading — a delight to investors as they anticipate that it will get even better given Donald Trump’s utterances on the campaign trail and his soon to be announced position as president.
Trump had promised to loosen perceived stranglehold on financial institutions and the business sector in general.
Wells Fargo & Co. (WFC.N), JPMorgan Chase & Co (JPM.N) and Bank of America (BAC.N) started the earnings season on a positive note on Friday, sending the S&P 500’s banking sub-sector.SPXBK up as much as 2.3 percent to its highest since February 2008 before paring gains.
It closed trading up 0.8 percent compared with a 0.2 percent gain for the broader S&P 500.SPX.
The banks’ top executives were upbeat in their general sentiments about earnings and their outlook for 2017.
The bank index rose 24.8 percent between Nov. 8 and Dec. 9 then traded sideways for a month as bond yields fell.
Investors continue to express optimism as Trump proposed policy measures such of lower taxes, fiscal stimulus, and lighter regulation are expected to have a positive impact on the banks.
Nigel Belle, Readers Bureau, Fellow
Edited by Jesus Chan
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