This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Large Bank ETFs Eye Earnings

NEW YORK ( TheStreet) -- Large financial institutions like JP Morgan Chase (JPM - Get Report) and Goldman Sachs (GS - Get Report) have bounced back harder than many of their regional banking peers, a trend reflected in their respective ETFs.

While large-cap oriented funds iShares Dow Jones US Financial Services (IYG) and SPDR KBW Capital Markets (KCE)have risen 23% and 49% year to date, regional peers like iShares Dow Jones US Regional Banks (IAT) and SPDR KBW Regional Banking KRE have fallen 10% and 24% respectively.

As a broad sector, financials have recovered substantially from March lows, but certain sub-sectors continue to lag others as investors recover from widespread market downturn.

Earnings announcements from big banks like JP Morgan, Bank of America (symbol), Wells Fargo (WFC - Get Report), Goldman Sachs, and Citigroup (C - Get Report) could help to further separate the big boys from the rest of the pack.

J.P Morgan's Wednesday earnings announcement underscored the improvement for large financial institutions. Despite problems with delinquencies in its consumer and credit-card operations, it reported strong profits in its earnings call. Pricey deposits from Washington Mutual and the recovery of leveraged loans and mortgage securities helped to fuel the $3.6 billion in posted profit.

The banking sector, particularly small banks, still have a long road to recovery.

During the Q&A portion of the earnings call, a representative from JPM fielded a call from analyst Meredith Whitney about the firm's exposure to commercial real estate. The representative noted: "Commercial real estate and the values have already dropped, and it's going to be recognized over the next couple of years. We believe you are seeing several hundred additional smaller regional based banks go -- you know, not make it."
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
KRE $44.72 1.27%
IYG $95.15 1.21%
KCE $50.91 0.30%
IAT $37.16 1.50%
BAC $17.22 1.18%

Markets

DOW 17,757.91 +138.40 0.79%
S&P 500 2,077.42 +14.31 0.69%
NASDAQ 5,013.1230 +26.2560 0.53%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs