After all the fears over tumbling profits, the big banks have been doing fairly well so far this earnings season, relatively speaking. Though the financial sector is still the worst-performing in the S&P 500 so far this year, the sector rose for a fifth consecutive session yesterday - even though their profits still fell.
Bank of America reported a fall in first-quarter profit, hurt by declining trading revenue and low interest rates. Wells Fargo said its profit fell as it grappled with a slump in oil prices. But for both, earnings per share came in above analysts’ expectations, and both stocks gained.
The upshot: The Dow Jones Industrial Average posted its biggest gain in a month this week, fueled by the rise in bank stocks. Overall, the index reached its highest level since July 20.