Market Overview

Are Big Banks A Buy Before Earnings Season?

Share:
Are Big Banks A Buy Before Earnings Season?

Earnings season for big banks kicks off next week, with Citigroup Inc (NYSE: C) scheduled to report Monday followed by heavyweights JPMorgan Chase & Co. (NYSE: JPM) and Wells Fargo & Co (NYSE: WFC) on Tuesday. Should investors be buyers ahead of earnings season? Two experts have mixed views.

'Very Cautious'

Taking a look at the chart for the financial sector ETF, the Financial Select Sector SPDR Fund (NYSE: XLF), investors should be "very cautious" heading into next week's busy earnings season, Blue Line Futures President Bill Baruch said during a recent CNBC "Trading Nation" segment.

The chart is showing "a lot of overhead resistance" around the $25 level, and recent weakness has the ETF gravitating closer to the 50-day moving average, he said. 

Also important to consider: bank stocks have in the past reported "solid" earnings,  only for the stocks to show a "knee-jerk reaction," Baruch said. 

Despite a "lot of resistance" in the financial sector ETF, investors can take advantage of a "a great buy for the long term" if shares dip below key resistance levels, he said. 

'Certainly Bullish'

Stacey Gilbert, head of derivative strategy at Susquehanna Financial Group, took the other side of the debate and said activity in the option market is "certainly bullish." Upside call buyers are building positions through call spreads, she said. 

Related Links:

Big Bank Q3 Earnings Roundup

2 Pros Debate: What's Next For Bank Stocks?

Posted-In: banksAnalyst Color Analyst Ratings Media Best of Benzinga

 

Related Articles (C + JPM)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
SSTIImperial CapitalDowngrades49.0
OSPNImperial CapitalDowngrades20.0
ENBLStifel NicolausUpgrades17.0
FAROGabelli & Co.Upgrades0.0
BDCLongbow ResearchDowngrades0.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Bed Bath & Beyond Rallies After Q3 Print, But Analysts Aren't Buying It

L.A. Warehouse Crunch Pushes Freight Into Northern California