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Financial Select Sector SPDR ETF (XLF)

  • Jul. 17, 2013, 1:37 PM
    Financial sector (XLF) prospects are more promising today than they've been for a few years, writes Fidelity's Chris Lee, noting repaired balance sheets, contained expenses, and the housing upturn. Toss in rising interest rates and the potential for accelerating capital returns. Priced in? No, he says, as valuations remain attractive. Offsetting the positive are regulatory concerns, the effect from the end of QE, and a re-bubbling up of EU troubles.
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  • Jul. 12, 2013, 4:31 AM
    Democratic Senator Elizabeth Warren, Republican counterpart John McCain and two others have introduced the "21st Century Glass-Steagall Act," a reprise of the 1930s law that was repealed in 1999 and that separated traditional banking such as home loans and checking accounts from riskier pursuits like investment banking and trading derivatives. Slogans such as "banking should be boring" and keep "keep the gamblers out of our banks" have a populist ring, but the legislation will face many hurdles.
  • Jul. 9, 2013, 4:25 PM
    Heading into an earnings season looking like a repeat to Q1's sluggish performance, financials (XLF) look most attractive, says BAML, but the materials sector (XLB) is to be avoided. Noted is the unusual level of zipped lips in the corporate world in June - "generally worrisome," says BAML, but managements were mum the last two quarters as well, and earnings ended up beating expectations.
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  • Jul. 9, 2013, 7:32 AM
    So much for late fees as a profit center. The credit card delinquency rate fell to 2.41% at the end of Q1 from 2.47% three months earlier - it's the lowest rate since 1990 and far below the 15-year average of 3.87%. Can the rate decline further? An improving economy is likely to induce banks (XLF) to lend to riskier borrowers and consumers to take on additional debt as evidenced in yesterday's consumer credit report.
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  • Jul. 8, 2013, 4:30 PM
    The new FDIC leverage rule for banks is reportedly going to be 5%, reports CNBC, well-above Basel's 3% requirement, but below the 6% floated over the past few weeks. Once the rule is proposed, it is then put out for comment and regulators might later adjust as necessary. The new requirement is expected to be a nonevent for the banks - many of which are already at that level and others which shouldn't have a problem tweaking things to get there.
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  • Jul. 6, 2013, 3:34 PM
    "With no recession in sight, we find it hard to make a bear case," says HSBC, noting that "the first tightening in a cycle … typically causes only a short-lived correction in stocks." The bank's global head of equity strategy Garry Evans says the combination of a "data dependent" taper, 10% earnings growth, and relatively conservative valuations makes for some attractive opportunities especially in financial stocks (XLF) which he says are cheap and poised for strong earnings momentum. HSBC also prefers U.S. equities (SPY, VTI) to other markets.
  • Jul. 2, 2013, 4:23 PM
    The FDIC will introduce a draft of leverage limits for the big banks (XLF) on July 9. It's expected these could be as much as double (to 6%) what's required by Basel III, but it's also expected many large U.S. lenders are already above that level and the ones below shouldn't have an issue reaching it. 6% is also an upper limit - chances are the level comes in somewhere between 3-6%.
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  • Jul. 2, 2013, 12:28 PM
    Banks with a heavy reliance on mortgage originations catch a break with new capital rules approved by the Fed today. The central bank decided not to increase risk-weightings for mortgages, citing new underwriting rules as well as other pending rules as the reasons. Small banks also get good news as any trust preferreds issued prior to 2010 are grandfathered in as acceptable capital.
  • Jul. 2, 2013, 9:36 AM
    The Fed is set to approve today moving forward with Basel III capital rules which will force 100 of the country's banks (XLF) to raise about $4.5B in capital by 2019. Included are rules limiting capital returns and bonuses if the buffers aren't in place. Like the long putter ban in golf, all have known and prepared for the new rules. "Move on, non-story," says a trader.
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  • Jul. 1, 2013, 11:55 AM
    The proposed doubling of bank (XLF) minimum leverage ratios to 6% isn't a big deal, says Credit Suisse, noting COF, WFC, PNC, and UBS are already above that level. The three with the lowest current levels (4.6% to 5.1%) - C, JPM, BAC - wouldn't have an issue getting to 6% if necessary. CS also notes the likelihood it won't be 6%, but instead a number well underneath.
  • Jun. 26, 2013, 3:54 AM
    Falling bond prices and rising yields are threatening the recovery in the balance sheets of global banks, which have built up huge portfolios of liquid securities to comply with regulatory requirements and due to a lack of better investments. For example, 90% of Bank of America's (BAC) $315B portfolio comprises mortgage bonds and Treasurys. Some analysts, though, believe that QE tapering should increase interest margins and offset the one-time hit to book values because of rising bond yields.
  • Jun. 25, 2013, 2:54 PM
    The Dow (DIA +0.8%) hangs on to a triple-digit gain a bit more than an hour before the bell even as Treasury yields continue to climb, the 10-year at 2.59% and the long bond at 3.61%. The day's strongest sector is the financials (XLF +1.9%) led by the TBTFs Bank of America, JPMorgan, and Ciitgroup all up 2.5%-4%.
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  • Jun. 25, 2013, 11:58 AM
    Looking for relative strength? With the S&P 500 off nearly 5% since May's end and the big-cap focused Financial Sector SPDR (XLF) down 5%, the Regional Banking ETF (KRE) is about flat as higher rates hold the promise of better margins. Within the KRE, those stocks looking the best technically to Frank Zorilla are ASBC, BBT, MTB, HBAN, HOMB, RF, ZION.
  • Jun. 21, 2013, 11:54 AM
    A check of the TBTFs finds Wells Fargo (WFC +0.9%) the only gainer amidst a floated report the Fed and FDIC are weighing a doubling in the "simple leverage ratio." Wells already exceeds the 6% proposed ratio, but presumably BofA (BAC -2.8%), JPMorgan (JPM -1.3%), Citigroup (C -4%), Goldman (GS -1.7%), and Morgan Stanley (MS -3.1%) would need to halt or pare back dividends and buybacks should the rule be implemented. The financial SPDR (XLF -1.4%).
  • Jun. 21, 2013, 8:53 AM
    Financial Select Sector SPDR ETF (XLF) announces quarterly distribution of $0.0771. 30-day SEC yield of 1.43% (as of 06/19/2013). For shareholders of record June 25. Payable July 01. Ex-div date June 21.
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  • Jun. 18, 2013, 3:04 PM
    Rising interest rates should be good for bank (XLF) income statements, but maybe bad for bank balance sheets, opines Fitch. Higher long rates mean wider margins which is good for earnings, but securities backing bank capital levels have large unrealized gains attached - gains which could disappear and turn into losses as rates rise. Basel III rules, of course, have yet to be finalized so the ultimate impact is not yet clear.
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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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