Friday, April 15, 2016

Banks Lead Stocks Higher

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.

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