Today kicks off the unofficial start of the fall earnings season with some big banks in focus, but before investors can dive into the earnings news they have to deal with some Apple (NASDAQ:AAPL) news. After Tuesday’s close, Apple announced it was lowering projections on the new iPhone 13 production targets because of the difficulty in getting parts. However, Bloomberg was reporting that some analysts are choosing to view this development as “deferred earnings” instead of “lost earnings” because they see demand for the iPhone 13 is still strong and the components problem as temporary.
While Apple is a little lower in premarket trading, some of its suppliers including Skyworks Solutions (NASDAQ:SWKS) and Qorvo (NASDAQ:QRVO) were is down 2.5% and 1.1% respectively before the market open.
Many investors are expecting good things from Financial stocks because they have benefited from rising interest rates. JPMorgan Chase (NYSE:JPM) was the first to report and beat analysts’ earnings expectations despite missing revenue estimates. Revenue was 5% lower, but the investment banking division soared 55% creating a record high for the company. JPMorgan also gave a vote of confidence in the economy, by releasing $2.1 billion they had set aside as a rainy day fund during the pandemic to hedge against loan defaults.
BlackRock (NYSE:BLK) was also able to beat estimates despite missing in certain key areas and First Republic Bank (FRC) wasn’t to be outdone and hit on both earnings and revenue. Tomorrow’s earnings will include a few more big financial companies like Bank of America (NYSE:BAC), Wells Fargo (NYSE:WFC), Morgan Stanley (NYSE:MS), and Citigroup (NYSE:C), just to name a few.
On the technology side, Infosys (NYSE:INFY) and Wipro (NYSE:WIT) both reported better-than-expected earnings and revenue. Both stocks were higher in premarket trading up 5% and 3.7% respectively.
Outside of technology, Delta Airlines (NYSE:DAL) was another company of note to report earnings. Delta has become a bit of a darling among the air sector because of Southwest’s (NYSE:LUV) recent struggles with cancellations. Delta beat on earnings and revenue but said that its planes are still flying at 80% capacity and international travel is low because of lingering hesitancy around COVID-19.
In commodities news, Crude oil (/CL) is trading lower to start the day. Smaller oil companies are beginning to join the fray and increasing supplies. Earlier this month, Russian President Vladimir Putin said Moscow would help to stabilize the struggling European energy markets; however, Bloomberg is reporting that Russia is currently replenishing its own supplies instead of sending it to Europe. It appears that Moscow hopes to use the situation to get its controversial Nord Stream 2 pipeline into Germany.
In economic news, the Consumer Price Index (CPI) was right on target as inflation grew as expected. With no major revelations, it’s unlikely that the Fed will change its tapering plans. The 10-year Treasury Index (TNX) traded 0.89% lower after the report.
This afternoon, the FOMC Meeting Minutes will be released but won’t reflect this morning’s CPI report. Instead, Fed members were working with the softer-than-expected August CPI and weaker-than-expected September jobs report. Some analysts are concerned that the Fed minutes may sound more dovish than expected.
Spread Thin
If the Fed continues with its tapering plans, yields could continue to rise. Financial stocks tend to benefit from rising rates because it increases the interest rate spread. The interest rate spread, or bank spread, is what an institution charges for a loan compared to what it pays in interest to those in savings and deposits. Typically, the interest on a loan is higher than the interest that is paid for savings. Financial institutions get paid on the difference. Of course, the wider the spread, the more money the institution could make. However, these institutions compete with each other, so they don’t want to keep the spread too wide or competitors will try to lure away their customers with lower loan rates or higher savings rates.
In addition to banks, investment firms and brokerages also tend to profit from higher interest rates. One way they earn money is from the cash balances held in their clients’ accounts. The money in the account is often swept into a bank where usually the client and the broker earn higher interest off the money. By sweeping the money into a bank, the client often gets other benefits such as federal deposit insurance, quicker access to money, check writing, debit cards, and online bill pay. Usually, these services don’t require any additional fees.
Of course, if rates get too high, then consumers may choose to not borrow money, and the banks may find themselves paying more people than they’re lending to. Additionally, falling rates tighten the spreads and lower revenue. However, when it comes to financial stocks, investors should stay on top of interest rates.
CHART OF THE DAY: BANK RATES. The Financial Select Sector Index ($IXM—candlestick) tends to follow the 10-year Treasury Yield (TNX—pink line) because the 10-year yield tends to correlate with mortgage rates. Data Sources: ICE, S&P Dow Jones Indices. Chart source: The thinkorswim® platform. For illustrative purposes only. Past performance does not guarantee future results.
Breaking Brick & Mortar: Online banks and fintech firms like Bofi (NYSE:AX) and Ally Financial (NYSE:ALLY) are gaining popularity among consumers and investors because their lower expenses can offer higher savings rates and lower mortgage rates. One reason they have lower expenses is that they don’t have expensive brick-and-mortar branches along with all the personnel it takes to run them. Instead, they tend to do most of their business online.
With that said, investors may want to consider other expenses before choosing a fintech firm over a regular bank because online banks could have higher interest expenses and fewer avenues of revenue than larger banks. Thus, they may have higher net expenses in the end.
Tap, Insert, or Slide: Many banks also profit from credit cards, but today, there are numerous ways to pay. These include other fintech stocks like Square (NYSE:SQ) and PayPal (NASDAQ:PYPL). Then there are companies like Green Dot Corporation (NYSE:GDOT) that use their banking technology to allow retailers like Walmart (NYSE:WMT) to act like banks by offering products that include higher-yielding savings accounts.
Many of these fintech firms are getting noticed. Last month, Goldman Sachs (NYSE:GS) announced plans to buy GreenSky LLC (NASDAQ:GSKY) for $2.24 billion. GreenSky does “pay as you go” home improvement loans. Earlier this week, Morgan Stanley analysts initiated coverage of SoFi (NASDAQ:SOFI) with an “overweight” rating, prompting a rally in the stock. However, many of these fintech platforms are still tied to interest rates because they hold a balance for their customers and share in the interest one way or another.
Marginal Utility: Utility stocks tend to be negatively impacted by rising yields or interest rates. This is because utility stocks are known for having low volatility and higher-than-average dividend yields. Therefore, utility stocks and bonds tend to compete for the same type of investor because bonds are also known for their low-risk income features. Bonds can have another advantage over utility stocks because they usually come with consistent interest payments and a return of principal at maturity. However, many utilities consistently increase their dividends each year, which doesn’t normally happen with a bond.
Nonetheless, when yields rise, many income investors move out of utilities and into the new higher-yielding bonds or they redirect new money to bonds instead of utilities. Investors holding utility stocks may have noticed that as yields have risen over the last few weeks, their utility stocks have fallen.
Increasing your interest in what causes interest rates to rise or fall can be helpful when making investment decisions.
TD Ameritrade® commentary for educational purposes only. Member SIPC.
Image Sourced from Pixabay
今天開始了秋季財報季的非正式開始,一些大銀行成為焦點,但在投資者能夠潛心研究盈利消息之前,他們必須處理一些蘋果(納斯達克:蘋果)新聞。週二收盤後,蘋果宣佈,由於難以獲得零部件,它將下調對新iPhone 13產量目標的預測。然而,彭博社報道稱,一些分析師選擇將這一進展視為“遞延盈利”,而不是“盈利損失”,因為他們認為iPhone 13的需求仍然強勁,零部件問題只是暫時的。
雖然蘋果在盤前交易中略有下降,但它的一些供應商包括。Skyworks解決方案:(納斯達克:SWKS)和中國Qorvo納斯達克:QRVO開盤前分別下跌2.5%和1.1%。
許多投資者期待金融股帶來好消息,因為他們從利率上升中受益。摩根大通摩根大通(NYSE:JPM)是第一家公佈業績並超過分析師預期的公司,儘管該公司的營收低於預期。收入下降了5%,但投資銀行部門飆升了55%,創下了該公司的歷史新高。摩根大通還對經濟投下了信任票,釋放了他們在疫情期間留出的21億美元,作為一個雨天基金,以對沖貸款違約。
貝萊德(紐約證券交易所股票代碼:BLK)也能夠超過預期,儘管在某些關鍵領域和目標上有所欠缺。第一共和銀行瑞銀(FRC)也不甘示弱,在盈利和營收方面都受到了打擊。但明天的財報將包括更多像這樣的大型金融公司。美國銀行*(紐約證券交易所股票代碼:BAC),富國銀行*(紐約證券交易所股票代碼:WFC),摩根士丹利(紐約證券交易所股票代碼:MS),以及花旗集團(紐約證券交易所代碼:C),僅舉幾個例子。
在技術方面,中國印孚瑟斯(紐約證券交易所股票代碼:INFY)和Wipro.(紐約證券交易所代碼:WIT)兩家公司都公佈了好於預期的收益和收入。這兩只股票在盤前交易中均走高,分別上漲5%和3.7%。
在技術之外,中國達美航空公司(紐約證券交易所代碼:DAL)是另一家公佈收益的知名公司。達美航空已經成為航空業的寵兒,因為西南航空公司(NYSE:LUV)最近一直在為取消訂單而苦苦掙扎。達美航空在盈利和營收方面表現不佳,但表示其飛機仍在以80%的運力飛行,國際旅行也很少,原因是圍繞新冠肺炎的猶豫不決。
大宗商品方面,美國原油美元(/CL)開盤走低。規模較小的石油公司開始加入競爭,增加供應。本月早些時候,俄羅斯總統總裁普京表示,莫斯科將幫助穩定陷入困境的歐洲能源市場。然而,彭博社報道說,俄羅斯目前正在補充自己的能源供應,而不是向歐洲輸送。莫斯科似乎希望利用這一局勢,將備受爭議的北溪2號管道輸送到德國。
在經濟新聞方面,隨著通脹如預期增長,消費者價格指數(CPI)正確地達到了目標。在沒有重大披露的情況下,美聯儲不太可能改變其縮減計劃。這個10年期美國國債指數報告發布後,TnX股價下跌0.89%。
今天下午,聯盟公開市場委員會的會議紀要將公佈,但不會反映今天上午的CPI報告。相反,美聯儲成員正在應對弱於預期的8月份CPI和弱於預期的9月份就業報告。一些分析師擔心,美聯儲的會議記錄聽起來可能比預期的更加鴿派。
鋪得很薄
如果美聯儲繼續實施縮減計劃,收益率可能會繼續上升。金融股往往受益於利率上升,因為它擴大了利差。利差,或銀行利差,是一家機構對貸款收取的費用,與它向儲蓄和存款支付的利息相比。通常情況下,貸款的利息高於儲蓄的利息。金融機構根據差額獲得報酬。當然,利差越大,該機構可以賺的錢就越多。然而,這些機構之間相互競爭,因此它們不想讓利差保持得太大,否則競爭對手會試圖用更低的貸款利率或更高的儲蓄利率來吸引客戶。
除了銀行,投資公司和券商也傾向於從更高的利率中獲利。他們賺錢的一種方式是利用客戶賬戶中的現金餘額。賬戶中的錢通常會被掃入銀行,客戶和經紀人通常會從這些錢中賺取更高的利息。通過將錢掃入銀行,客戶通常會獲得其他好處,如聯盟存款保險、更快地獲取資金、開支票、借記卡和在線賬單支付。通常情況下,這些服務不需要任何額外費用。
當然,如果利率變得太高,那麼消費者可能會選擇不借錢,銀行可能會發現自己支付給更多的人,而不是貸款給他們。此外,不斷下降的利率收緊了利差,降低了收入。然而,當談到金融股時,投資者應該保持對利率的掌控。
當日圖表:銀行利率。金融精選行業指數($IXM-燭臺)傾向於跟隨10年期美國國債收益率(Tnx-粉色線),因為10年期國債收益率往往與抵押貸款利率相關。-數據來源:ICE,標普道瓊恩斯指數。圖表來源:The Thinkkorswm®Platform。僅供說明之用。過去的表現並不能保證未來的結果。
打破磚瓦和砂漿:中國的網上銀行和金融科技這樣的公司美國銀行(紐約證券交易所股票代碼:AX)和聯合金融公司L(NYSE:ALLY)在消費者和投資者中越來越受歡迎,因為它們的較低支出可以提供更高的儲蓄率和更低的抵押貸款利率。他們費用較低的一個原因是,他們沒有昂貴的實體分支機構以及運營這些分支機構所需的所有人員。相反,他們傾向於在網上完成大部分業務。
話雖如此,投資者在選擇金融科技的公司而不是正規銀行之前,可能會考慮其他費用,因為與大銀行相比,網上銀行的利息支出可能更高,收入渠道可能更少。因此,他們最終可能會有更高的淨支出。
輕觸、插入或滑動:雖然許多銀行也從信用卡中獲利,但在今天,支付方式不勝枚舉。其中包括金融科技等其他股票。正方形(紐約證券交易所股票代碼:SQ)和貝寶(納斯達克:PYPL)。然後是像這樣的公司。綠點公司使用其銀行技術的零售商(紐約證券交易所代碼:GDOT)允許像這樣的零售商沃爾瑪紐約證券交易所股票代碼:WMT)像銀行一樣,提供包括高收益儲蓄賬戶在內的產品。
許多這樣的金融科技公司正在引起人們的注意。上個月,高盛(紐約證券交易所股票代碼:GS)宣佈了收購計劃。格林斯基有限責任公司納斯達克(Sequoia Capital:GSKY)22.4億美元。格林斯基確實“現收現付”的家裝貸款。本週早些時候,摩根士丹利分析師發起了對中國的報道。SOFI納斯達克(Sequoia Capital:SOFI)給予增持評級,推動該股反彈。然而,這些金融科技平臺中的許多仍然與利率捆綁在一起,因為它們為客戶持有平衡,並以某種方式分享利息。
邊際效用:公用事業類股往往會受到收益率或利率上升的負面影響。這是因為公用事業股以低波動率和高於平均水準的股息收益率而聞名。因此,公用事業股和債券往往爭奪同一類型的投資者,因為債券也以其低風險收入特徵而聞名。與公用事業股相比,債券還有另一個優勢,因為它們通常會支付一致的利息,並在到期時獲得本金回報。然而,許多公用事業公司每年都會不斷增加股息,這在債券市場上是不常見的。
儘管如此,當收益率上升時,許多收益型投資者會離開公用事業公司,轉投新的高收益債券,或者將新資金重新投向債券,而不是公用事業公司。持有公用事業股的投資者可能已經注意到,隨著過去幾周收益率的上升,他們的公用事業股下跌。
增加你對導致利率上升或下降的因素的興趣,在做出投資決策時會很有幫助。
TD ameritrade®評論僅用於教育目的。成員SIPC。
圖片來源:Pixabay