Financial Select Sector SPDR ETF (XLF) - NYSEARCA
  • Thu, Apr. 7, 12:58 PM
    • The Nasdaq's down 1.2%, the S&P 500 1%, and DJIA 0.9% three hours before the close.
    • Oil's lower by 2.7%, but it's the financial sector's (NYSEARCA:XLF1.5% decline leading markets to the downside as banks and other carry players mull another six basis point fall in the 10-year Treasury yield to 1.70%.
    | Thu, Apr. 7, 12:58 PM | 1 Comment
  • Tue, Apr. 5, 3:56 PM
    • Showing why there's a good chance these annual stress tests will be of little use the next time a crisis hits the economy or markets, last year's submission required banks to model what loan losses might look like if oil shot up to $110 per barrel. Black gold has since plunged to $30.
    • "One thing that people point out time and time again is that if you only looked in the rear-view mirror in 2006, you would never expect a 30% decline in home prices,"says Deloitte & Touche's David Wright. The Fed declined comment.
    • One curveball thrown in by D.C. this year was for banks to factor negative interest rates similar to what Europe and Japan are experiencing right now.
    • One fact remains: That banks have built up such large capital cushions, it's hard to imagine them failing the quantitative portion of the stress tests. At issue for most will be the qualitative portion - where is the data coming from and how reliable is it. "Firms that don't have a buttoned up process for reconciling and reporting the data … will be more vulnerable to a fatal problem," says PwC's Michael Alix.
    • ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, IYG, FNCL, SEF, FXO, RYF, FINU, RWW, XLFS, FINZ
    | Tue, Apr. 5, 3:56 PM | 2 Comments
  • Mon, Apr. 4, 9:36 AM
    • Global regulators might finally be warming to the idea that the pendulum on bank rules has swung too far to the stringent side. Following a pledge earlier this year from Basel, that same group is reportedly considering a new way of calculating leverage ratios which could end up easing capital requirements for some lenders.
    • The change involves the netting of derivatives exposures.
    • No celebration is called for just yet - the regulators are also said to be planning to lift the minimum leverage ratio threshold by 100 basis points to 4%, which would essentially offset any boost the banks would get from the new derivatives math.
    • This is really of most concern to European lenders like Deutsche Bank (NYSE:DB), Credit Suisse (NYSE:CS) and UBS. U.S. banks have to meet a 5% leverage ratio.
    • ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, IYG, FNCL, SEF, FXO, RYF, FINU, RWW, XLFS, FINZ
    • Now read: Credit Suisse And Deutsche Bank Still At The Forefront (Just Where They Don't Want To Be)
    | Mon, Apr. 4, 9:36 AM | 5 Comments
  • Wed, Mar. 30, 3:44 PM
    • Nobody wants banks, writes Ken Brown in the WSJ, but everybody wants commercial real estate. The result: Bank yields are higher than that of CRE.
    • A report from BAML says the big banks have boosted dividends faster than any other sector, and the total cash yield to owners, including buybacks, is at its strongest level since 2003. "Both are signs of strength," writes Brown, "though investors refuse to believe them."
    • On the other hand, "Real estate is not cheap anymore," says Green Street's Peter Rothemund. One particular warning sign: Foreigners flooded the market last year, buying a net $57B of U.S. property vs. an average of just $3B annually for the previous five years.
    • ETFs: XLF, FAS, FAZ, KRE, UYG, VFH, KBE, IYF, BTO, IAT, IYG, SEF, FNCL, FXO, KBWB, QABA, RYF, FINU, KBWR, KRU, RWW, FINZ, KRS, XLFS
    | Wed, Mar. 30, 3:44 PM | 1 Comment
  • Tue, Mar. 29, 2:49 PM
    | Tue, Mar. 29, 2:49 PM | 10 Comments
  • Thu, Mar. 24, 10:43 AM
    • Oil's lower by 2.9% today and about 10% for the week, but it's the financial sector (XLF -1.3%) leading the S&P 500's 0.5% decline today. This even as Jim Bullard becomes the latest Fed speaker to more or less disavow last week's dovish FOMC meeting result, and suggest higher rates could come as soon as April's get-together.
    • Morgan Stanley (MS -2.9%), Citigroup (C -2.5%), BB&T (BBT -1.3%), U.S. Bancorp (USB -1.3%), MetLife (MET -2.8%), Prudential (PRU -3.5%)
    • ETFs: XLF, FAS, FAZ, KRE, UYG, VFH, KBE, IYF, BTO, IAT, IYG, SEF, FNCL, FXO, KBWB, QABA, RYF, FINU, KBWR, KRU, RWW, FINZ, KRS, XLFS
    | Thu, Mar. 24, 10:43 AM | 14 Comments
  • Fri, Mar. 18, 2:44 PM
    • Materials Select Sector SPDR ETF (NYSEARCA:XLB) - quarterly distribution of $0.1573. 30-Day Sec yield of 2.14% (as of 3/16/2016).
    • Energy Select Sector SPDR ETF (NYSEARCA:XLE)- quarterly distribution of $0.4524. 30-Day Sec yield of 3.18% (as of 3/16/2016).
    • Financial Select Sector SPDR ETF (NYSEARCA:XLF)- quarterly distribution of $0.1230. 30-Day Sec yield of 2.04% (as of 3/16/2016).
    • Industrial Select Sector SPDR ETF (NYSEARCA:XLI) - quarterly distribution of $0.2828. 30-Day Sec yield of 2.11% (as of 3/16/2016).
    • Technology Select Sector SPDR ETF (NYSEARCA:XLK) - quarterly distribution of $0.2202. 30-Day Sec yield of 1.77% (as of 3/16/2016).
    • Consumer Staples Select Sector SPDR ETF (NYSEARCA:XLP) - quarterly distribution of $0.2709. 30-Day Sec yield of 2.35% (as of 3/16/2016).
    • Utilities Select Sector SPDR ETF (NYSEARCA:XLU) - quarterly distribution of $0.3675. 30-Day Sec yield of 3.31% (as of 3/16/2016).
    • Health Care Select Sector SPDR ETF (NYSEARCA:XLV) - quarterly distribution of $0.2367. 30-Day Sec yield of 1.60% (as of 3/16/2016).
    • Consumer Discretionary Select Sector SPDR ETF (NYSEARCA:XLY) - quarterly distribution of $0.3211. 30-Day Sec yield of 1.43% (as of 3/16/2016).
    • Financial Services Select Sector SPDR Fund (NYSEARCA:XLFS) - quarterly distribution of $0.1226. 30-Day Sec yield of 1.78% (as of 3/16/2016).
    • Real Estate Select Sector SPDR Fund (NYSEARCA:XLRE) - quarterly distribution of $0.3030. 30-Day Sec yield of 3.04% (as of 3/16/2016).
    • All are payable Mar. 29; for shareholders of record Mar. 24; ex-div Mar. 22.
    | Fri, Mar. 18, 2:44 PM | 2 Comments
  • Thu, Mar. 17, 3:08 PM
    • With the S&P 500 returning to more or less flat on the year, Bespoke digs down into sector performance and finds most of them nicely in the green, including the roughed-up energy group (NYSEARCA:XLE) with a 5.9% gain.
    • Leading on the upside, though, are the telecoms (NYSEARCA:XTL), ahead 14.4%, and utilities (NYSEARCA:XLU), up 13.3%. Consumer Staples (NYSEARCA:XLP), Materials (NYSEARCA:XLB), and Industrials (NYSEARCA:XLI) are all up between 3.7% and 4.5%, while Consumer Discretionary (NYSEARCA:XLY) is flat.
    • Holding the S&P 500 back, then, is healthcare (NYSEARCA:XLV), with an 8.2% decline, and financials (NYSEARCA:XLF), down 5.5%. Within, healthcare, the biotechs (NASDAQ:IBB) have plunged 27%.
    | Thu, Mar. 17, 3:08 PM
  • Thu, Mar. 17, 2:44 PM
    • Increasingly negative policy rates overseas, lame global growth, high financial market volatility, and now a Fed on pace to hike substantially less than hoped ... "None of this is likely supportive of financials sector relative performance," say Wells Fargo's Gina Adams and Peter Chung, downgrading banks from Overweight to Market Weight, and capital markets to Underweight from Market Weight.
    • The only group the team likes as Overweight is insurance, which is likely to show the strongest earnings this year (hard to fathom given low rates).
    • The bank's analysts cover 70 of 90 names in the S&P 500 financials sector, with just 28 of those 70 rated Outperform.
    • ETFs: XLF, FAS, FAZ, KRE, UYG, VFH, KBE, IYF, BTO, KIE, IAT, IYG, IAK, SEF, FNCL, FXO, KBWB, QABA, RYF, KBWR, FINU, KCE, KRU, RWW, KBWP, KBWC, KBWI, FINZ, KRS, XLFS
    | Thu, Mar. 17, 2:44 PM | 8 Comments
  • Wed, Mar. 16, 2:28 PM
    | Wed, Mar. 16, 2:28 PM | 55 Comments
  • Wed, Mar. 16, 12:24 PM
    • "Q1 is normally our strongest quarter and it hasn't been very strong," Deutsche Bank CEO John Cryan told an investment conference earlier today.
    • There's apparently "good" volatility - which boosts trading revenue - and "bad" volatility, which does the opposite, and Q1 was mostly the "bad" kind. According to analytics firm Tricumen, FICC revenue at banks is expected to fall to $19.2B in Q1 of this year. That's the worst Q1 in four years and down from $22.6B a year ago, and $30B in 2012.
    • "Bad" volatility: "There are more and more signs of fragmentation and liquidity is drying up. Banks are still deleveraging and are required to hold greater capital against their balance sheets ... it's difficult for our customers to make money," says the head of FICC trading at a top-tier bank. "Macro hedge funds are really struggling, and when our customers don't make money, we struggle."
    • Speaking at the same conference, UBS CEO Sergio Ermotti: "We and the industry are facing unprecedented headwinds ... Industry activity levels in investment banking advisory have slowed markedly year on year."
    • Previously: Credit Suisse tumbles as management pulls out of conference (March 16)
    • ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, IAI, IYG, SEF, FNCL, FXO, RYF, FINU, KCE, RWW, KBWC, FINZ, XLFS
    | Wed, Mar. 16, 12:24 PM
  • Mon, Mar. 14, 3:19 PM
    • The financial sector (NYSEARCA:XLF) has performed woefully this year, and the banks (NYSEARCA:KBE) even worse. Cornerstone Macro technician Carter Worth finds twenty names trading well beneath their (falling) 150-day moving averages.
    • The group has shown signs of life lately, and Worth thinks the stocks could move back to their 150-day averages, as stocks in other market sectors have done.
    • It's strictly a trade, says Worth, who continues to rate the financials as Underweight. The 20:
    • Ameriprise (NYSE:AMP), BofA (NYSE:BAC), Banner (NASDAQ:BANR), Citigroup (NYSE:C), Citizens Financial (NYSE:CFG), East West Bancorp (NASDAQ:EWBC), First NBC (NASDAQ:FNBC), HFF (NYSE:HF), KeyCorp (NYSE:KEY), Legacy Texas (NASDAQ:LTXB), Lincoln National (NYSE:LNC), Morgan Stanley (NYSE:MS), Old National (NASDAQ:ONB), PacWest (NASDAQ:PACW), PNC Financial (NYSE:PNC), Principal Financial (NYSE:PFG), Stifel Financial (NYSE:SF), SVB Financial (NASDAQ:SIVB), TCF Financial (NYSE:TCB), Wells Fargo (NYSE:WFC).
    | Mon, Mar. 14, 3:19 PM | 12 Comments
  • Fri, Mar. 11, 3:28 PM
    • This just in: The XLE is in the green for the year, with today's 2.75% advance putting the ETF higher by 3.5% for 2016. Today's move comes as oil gains 2.3% (and 7% for the week) to its highest level since early December.
    • The S&P 500 is creeping closer to green this year as well, with today's 1.55% advance putting that index lower by just 1.2% YTD.
    • Also on the move this session are the financials (XLF +2.6%) as the rising interest rate trade is back on. The 10-year Treasury yield is up another five basis points to 1.98%. It hasn't been above 2% since January.
    | Fri, Mar. 11, 3:28 PM | 2 Comments
  • Fri, Mar. 11, 9:33 AM
    • "If you follow the math you can't reach any other conclusion," says Stanford Profesor Darrell Duffie, who's work previously spurred changes in how banks value credit risk and debt.
    • Swaps deals are funded with money borrowed from the bank's treasury, and that cost is deducted from the derivatives' value. That's wrong, says Duffie. Banks instead should charge trading partners more up-front, thus freeing up capital for, say, dividends.
    • Duffie hasn't yet shown the paper to any Wall Street executives. “I imagine there’s going to be some howling by the banks because they think their accounting practices are right."
    • ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, IAI, IYG, SEF, FNCL, FXO, RYF, FINU, KCE, RWW, KBWC, FINZ, XLFS
    | Fri, Mar. 11, 9:33 AM
  • Thu, Mar. 3, 8:37 AM
    • The global economy has been powered by credit for more than 40 years, says Bill Gross - noting official credit outstanding today of $58T is 58x that of 1970. That expansion, though, looks to be ending, as private sector savers are growing leery, and regulators build fences against fast creation. And don't forget the meager returns, with negative interest rates in 40% of Euroland, and out ten years on the curve in Japan.
    • The collapse in bank stocks globally isn't necessarily about energy losses. Price charts since 2007 for players like Citigroup (NYSE:C), Bank of America (NYSE:BAC), Credit Suisse (NYSE:CS), Deutsche Bank (NYSE:DB), and Goldman Sachs (NYSE:GS) suggest the sector's either a screaming cheap buy, or "a permanently damaged victim of writes-offs, tighter regulation, and significantly lower futures margins. I'll vote for the latter."
    • Then there's insurers, whose business models - which depend on 7-8% returns from risk assets - are at risk. They're not going bankrupt, but future profitability for companies like MetLife (NYSE:MET), Prudential (NYSE:PRU), and Hartford (NYSE:HIG) will be stifled as claims can't be covered as easily when investment returns are so lame.
    • The same goes or pension funds, and Puerto Rico is going down Detroit's path not just because of overpromised benefits, but because they're not earning enough on their investment portfolios to cover those promises.
    • Central bankers, meanwhile, think they can solve things by cutting rates just a bit further.
    • ETFs: XLF, FAS, FAZ, UYG, VFH, IYF, BTO, IYG, SEF, FNCL, FXO, RYF, FINU, RWW, FINZ, XLFS
    | Thu, Mar. 3, 8:37 AM | 35 Comments
  • Wed, Feb. 24, 1:13 PM
    • It's another nasty session for banks today, writes David Reilly, and the KBW Nasdaq Bank Index is now lower by almost 20% YTD, with names like Citigroup (C -2.3%) and Bank of America (BAC -2.3%) down nearly 30%.
    • The nasty feedback cycle begins with the crash in the oil price, which stings banks thanks to worries of big losses on energy-lending, and more broadly hurts lenders by dragging down the stocks in general. This in turn, leads to concern about a recession would further ding bank profits.
    • More ominous, the yield curve is flattening. Using the spread between two-year and 10-year Treasury notes isn't a bad proxy for bank profits and it's slumped to just 0.96% today. Old-timers will remember when this spread used to turn negative - a sure sign of looming recession.
    • The good news, says Reilly, is that the energy crash and low rates don't look to cause the sorts of losses seen in 2008. Take the long view - the cycle will someday turn.
    • ETFs: XLF, FAS, FAZ, KRE, UYG, VFH, KBE, IYF, BTO, IAT, IYG, SEF, FNCL, FXO, KBWB, QABA, RYF, FINU, KBWR, KRU, RWW, FINZ, KRS, XLFS
    | Wed, Feb. 24, 1:13 PM | 35 Comments
XLF Description
The Financial Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Financial Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
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Sector: Financial
Country: United States
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