MomentumOptionsTrading.com Midday Update for 7/11/2014
Wells Fargo (WFC) Slips on Earnings
Bank stocks will be in focus all next week and shares of Wells Fargo (WFC, $51.81, down $0.38) started off the parade early after reporting earnings ahead of this morning’s opening bell.
The company reported a profit of $1.01 a share on revenue of $21.1 billion. Wall Street was looking for $1.01 a share on revenue north of $20.8 billion.
The high estimate from the nearly 30 analysts that follow the company came in at $1.06 a share. The low estimate called for a profit of 93 cents a share.
The beat on revenue was slightly bullish but the results have weighed on the market with the Financial Select Sector Spiders (XLF, $22.62, down $0.03) trending lower.
The bears have left clues throughout the week they are waking up again with lower lows and an edgy VIX. The bulls have lost 3-straight Monday sessions and are in danger of having their 7-straight Friday win streak snapped if the Blue-chips close at current levels.
The Dow is down 20 points to 16,894 while the S&P 500 is slipping 2 points to 1,962. The Nasdaq is up 7 points to 4,403 and the Russell 2K is lower by 4 points to 1,157. The S&P Volatility Index ($VIX, 12.51, down 0.08) is wavering at support/resistance.
I will talk more about the Financial sector in upcoming issues and how they will play a role in the market moving foward. Citigroup (C, $46.90, down $46.92, up $0.02) will announce their numbers ahead of Monday’s open and I will cover the other companies and their due dates in more detail in this weekend’s Weekly Wrap and in the Daily.
I have updated the current trades and despite taking one on the chin today, the portfolio is in great shape to play the upcoming volatility. Instead of focusing on earnings, there may be a great opportunity coming to trade the indexes as volatility heats up.
I will be back on Sunday night with the Weekly Wrap and on Monday with the Daily. Until then, have a great weekend everyone!