Banks Gain After Earnings to Reward Recent Congress Buyers
Bank stocks are trading higher on Friday after major sector players reported strong profit numbers, buoyed by a high-rates environment.
JPMorgan (JPM:US), Wells Fargo (WFC:US), and Citi (C:US) all saw shares higher after each bank reported results before the market opened. JPMorgan led the rally while WF and Citi moved modestly higher.
"The U.S. economy continues to be on generally healthy footings—consumers are still spending and have strong balance sheets, and businesses are in good shape. However, the storm clouds that we have been monitoring for the past year remain on the horizon, and the banking industry turmoil adds to these risks," CEO Jamie Dimon said in a press release.
The banking giant easily topped the average analyst estimate for a profit of $3.41 per share on revenue of $36.19 billion by reporting EPS of $4.32 on sales of $39.34 billion. This prompted Dimon’s bank to boost its full-year forecast for net interest income (NII) - the closely-watched financial metric for bank investors - by $7 billion to $81 billion.
Similarly, Wells Fargo reported solid results as the jump in commercial loans (+15%) offset a 5% drop in consumer deposits. Rival Citi also reported better-than-expected earnings, boosted by higher income from loans. Citi also said its profits figures were supported by the sale of its Indian consumer business.
The JPMorgan stock rally rewarded recent buyers, including Congressman Ro Khanna who was buying shares last month. More notably, Rep. Khanna disclosed earlier this week that he invested between $100,000 - $250,000 in Wells Fargo stock on March 06.
