Big Day For Banks — Here’s Why

Stocks
are lower as investors await blue-chip earnings.

Four major banks reported earnings today — all showing strength in consumer
deposits and demand for credit. Citibank
(
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led the pack, with
earnings rising by 27%. Revenue rose 13% to $20.15 billion. Wells Fargo
(
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reported 10% higher earnings at $1.62 billion on sales of $7.44 billion. US
Bancorp

(
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and Bank One
(
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also showed improved
earnings.

Earnings of drug-maker
Johnson & Johnson

(
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rose 33% on strong orders for its medical
devices. The company earned $1.8 billion on sales of $11.25
billion. Manufacturing giant United Technologies
(
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posted a 10%
increase in revenue, earning $588 million on sales of $8.59 billion. The company
said a lower tax rate and the weak dollar helped boost its bottom line.

Dow
-60.51

10540.06
S&P 500
-1.59
1138.25
Nasdaq -1.30
2139.27

The day’s leading sectors are
Amex Gold Bugs
(
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+4.30%, Oil Services
(
OSX.X |
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+3.96%,
Gold and Silver
(
XAU.X |
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+3.12%, and Natural Gas
(
XNG.X |
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+2.40%.

Weak today are Airlines
(
XAL.X |
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-1.01%, and Retail
(
RLX.X |
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-0.95%.

No Economic news
releases today.

10-year Notes are -5 at
114 095

The dollar
is -1.13 at 86.92

Gold is +5.40 at 413.50

Crude Oil is +.49 at
34.00

Volume is 800,000,000 on
the NYSE, and 1,340,000,000 on the Nasdaq.

Market breadth is positive.

NYSE Issues
Advancing 1765 Up Vol
478
Declining 1380 Down Vol
313
Ratio 1.31 1.51
Nasdaq
Advancing 1696 Up Vol
794
Declining 1446 Down Vol
534
Ratio 1.15 1.49

Top Dow stocks are:

Alcoa [AA|AA],
+2.73% at 36.04, Johnson & Johnson
(
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, +2.58% at 51.77, SBC
Communications
[SBC|SBC
],
+2.01% at 27.00, and AT&T [T|T
],
+1.76% at 21.40

Stocks in the news:

3M
(
MMM |
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reported 21% higher earnings
of $619 million on sales of $4.7 billion. The company also raised its fiscal
year earnings to $3.49 a share. It reported a 38% increase in its display and
graphics unit and an 8% increase in safety and security services. GM’s US market
share deteriorated by 0.3%, to 28.0%.

General Motors
(
GM |
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reported lower
profits, with its finance unit providing most of the gain. Net income was $1.013
billion on higher sales of $49.08 billion, with its finance division providing
$630 million of the profit.

Chip-maker AMD
(
AMD |
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rose after Schwab
SoundView upgraded it to outperform, citing a favorable management
structure. AMD’s target price was raised to $23.

Ameritrade
(
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rose more than 10%
on first-quarter earnings of $72 million on revenues of $226
million. Commissions rose to $152 million from $116 million a year ago.

bricew@tradingmarkets.com