Bank of America earnings, Home Builder Sentiment, US Stock Markets edge higher
July 18, 2016
Monday – July 18
Bank of America reported better-than-expected earnings in its latest quarterly report led by a surge in its fixed income trading business. The bank reported earnings per share of $0.36 versus the $0.33 expected. Revenues for the quarter came in at $20.41 billion, down from $22.34 billion in the year-ago period. Within the report it showed that the bank’s delinquencies and charge-offs for its credit card business declined from the first quarter. Employee headcount is down 2.8% year-over-year due to the low interest rate environment.
Home builder sentiment edged lower in July due to lower foot traffic, though still remained in positive territory. The National Association of Home Builder Sentiment Index fell a point to 59, below the 61 expected. Any number over 50 indicates that more builders view conditions as good rather than poor. All three components declined in July, including current sales expectations, buyer traffic and sales expectations for the next six months. “The economic fundamentals are in place for continued slow, steady growth in the housing market,” said NAHB Chief Economist Robert Dietz. “Job creation is solid, mortgage rates are at historic lows and household formations are rising. These factors should help to bring more buyers into the market as the year progresses.”
U.S. Stock markets continued to edge higher to begin the new week after both the Dow Jones Industrial Average and the S&P 500 hit record closing levels last week. Today’s push higher comes from better-than-expected earnings from Bank of America and the failed coup attempt in Turkey over the weekend. An improving U.S. economy, the positive start to earnings season and easing headlines from the Brexit vote along with low interest rates are buoying the equity markets.
