EmailThe S&P 500 Financial Index remains in the green as we head into afternoon trading. The index ran into resistance at the 177 level and has slid back to the 174 level. News has been light in the sector so technicals are playing a bigger role with the index settling into this 172-177 range. Until the group is able to push above the 177 level this will remain a drag on any potential rally. Of note, the European banking sector was hit in early overseas trade following the Sarkozy/Merkel announcement that they were looking to implement a previously announces transaction tax. However, the group was able to shake of those losses as there is plenty of doubt that the tax would be able to pass.
News of Note:
1) Bloomberg.com reports sources are telling them that Bank of America Corp. (BAC) may settle a state and federal probe of foreclosure practices in a deal that lets New York proceed with an inquiry into securitizations, according to two people with direct knowledge of the talks. The firm may pursue an accord with most of the 50 state attorneys general, even if it omits New York's Eric Schneiderman and at least two other states who are opposed because a deal would impede related inquiries. Negotiations on a broad settlement stalled after Schneiderman indicated he wouldn't let it block his probe into the bundling and sale of mortgages, said the people, who declined to be identified because talks are private. One of the largest legal matters still pending is the multi- state probe into whether firms servicing mortgages used bogus documents to justify foreclosures.
2) Eaton Vance (EV) reports Q3 (Jul) earnings of $0.55 per share, $0.04 better than the Capital IQ Consensus Estimate of $0.51; revenues rose 19.8% year/year to $327.3 mln vs the $320.8 mln consensus. Assets under management on July 31, 2011 were $199.0 billion. This represents an increase of 15 percent from the $173.3 billion of managed assets as of July 31, 2010 and a decrease of 2 percent from the $203.0 billion of managed assets as of April 30, 2011. "Eaton Vance reported strong year-over-year profit growth and continuing positive net flows in the third quarter of fiscal 2011."
3) OptionsXpress (OXPS) reported retail daily average revenue trades of 32,600, 23% higher YoY, 15% higher than June 2011. Institutional daily average revenue trades of 14,400 - 7% higher YoY, 4% lower than June 2011. Net new customer accounts of 2,000. Ending customer accounts of 399,400 - 9% higher YoY, 1% higher than June 2011. Ending client assets of $8.4 billion - 13% higher YoY, flat with June 2011. Finally, it reported ending margin balances of $224 mln - 5% higher YoY, 2% lower than June 2011.
