Thompson Reuters Archives - Bartle Doo Article Archives

1. Earnings season kicks off

First-quarter earnings season unofficially kicks off today with
Alcoa

reporting after the close. The outlook this quarter has been particularly weak. According to Thompson Reuters, earnings at
S&P 500
companies are set to increase by only 1% compared to 6.2% in the fourth quarter of last year — analysts
surveyed by Bloomberg
estimate that the figure will fall 1.8%. Additionally,
data and analysis
from FactSet shows that 86 companies have issued negative guidance, versus 24 that have issued positive earnings guidance.

In terms of bank stocks, JPMorgan Chase and Wells Fargo both report on April 12, followed by Citigroup on the 15th, and Bank of America on the 17th.

2. Bernanke speaks after the bell
The chairman of the Federal Reserve, Ben Bernanke, is set to speak after the markets close today. Given the particularly abysmal jobs report last week, many are expecting him to continue pushing the central bank’s aggressive monetary stance, under which it’s purchasing $85 billion in treasuries and agency mortgage-backed securities a month.

3. Japan’s central bank has sparked a rally
Speaking of central banks, the Bank of Japan sparked a massive rally in Japanese stocks. The country’s most closely followed index, the Nikkea 225, is at a nearly five-year high, increasing by 46% over the last six months alone. The Yen is also well on its way to a five-year low relative to the dollar. After trading below 80 to the dollar for much of last year, it’s on the verge of breaking the 100 benchmark. As The Wall Street Journal noted, “The new and (as far the market and Japanese exporters are concerned) improved Bank of Japan under the leadership of Haruhiko Kuroda took a page from the Fed’s ‘shock and awe’ playbook, unveiling a bond-buying program that was far larger than anybody expected; in some quarters, it’s being called QQE.”

4. Bank of America seeks to woo customers
The nation’s second largest bank is rolling out a new advertising campaign in conjunction with the NCAA college basketball tournament. It’s designed to be a more humble approach. “We are a facilitator,” a Bank of America marketing executive said. “It’s not about us. We need to focus on customer needs first and we know our place. We know we’re not the center of your life, but we will connect you to what it is.” The move comes on …read more

Source: FULL ARTICLE at DailyFinance

By John Maxfield, The Motley Fool

Filed under: Investing

There’s no getting around it: This morning’s jobs report was bad. Economists surveyed by Thompson Reuters were expecting total payrolls to grow last month by 200,000. Analysts and traders were accordingly shocked when the Department of Labor announced that the actual figure was only 88,000. An investment strategist quoted by Bloomberg News summed it up succinctly: “This report is a huge disappointment.”

Few companies are being hit harder by the news than insurance companies. For the past few months, there’s been a growing chorus of speculation that the Federal Reserve will wean the economy off its current, highly accommodative monetary policy — the central bank is purchasing $85 billion in Treasuries and agency mortgage-backed securities a month. That would mean higher interest rates and thus larger profits for insurers.

The likelihood that this will happen now seems to have evaporated — if it was ever likely at all, considering the Fed’s previous statement that it will keep rates low into 2015. “Fed officials have been wary of pulling back too quickly, given the disappointments the economy has produced in the past during this recovery,” said The Wall Street Journal‘s Jon Hilsenrath. “[Today’s] report reinforces that wariness.”

What this means for insurance companies like MetLife is a prolonged period of low interest rates, making it difficult for them to turn a profit without taking on too much risk. As an analyst quoted by Bloomberg News put it in a research note to clients, “Sustained low interest rates present a challenge for life insurers because of reduced reinvestment rates.”

It’s for this reason that six of the S&P 500‘s 20 worst-performing stocks today are insurance companies. AFLAC is leading the way down, having lost 4.1%, followed by Prudential Financial , Unum Group , Hartford Financial, and Lincoln Financial. For its part, MetLife has lost 2.7% of its value today.

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The article MetLife and Other Insurance Company Hit Hard by Jobs Report originally appeared on Fool.com.

John Maxfield has no position in any stocks mentioned. The Motley Fool recommends Aflac. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Source: FULL ARTICLE at DailyFinance

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Earnings Season Kicks Off, Bernanke's Speech, and Today's Other Major Financial Stories

MetLife and Other Insurance Company Hit Hard by Jobs Report

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