PMI Index: Component Growth Impacts Banks
A growing economy definitely benefits the banking sector. The impact will be positive for big banks and also for regional banks.
Rate Hike Expectations Propelled Financial Stocks Higher
Many banks and financial service providers’ stocks rose on December 15. US investors picked the stocks with the expectation of the zero interest rate policy.
Why Analysts Are Bullish on US Banks in the Face of a Fed Rate Hike
With more than 50% buy ratings, analysts seem positive about the financial sector in the long term.
How Your Bond Mutual Fund Could Face Liquidity Risk—and Why
Mutual funds currently own ~20% of outstanding corporate bonds—a gaining trend. Bond mutual funds thus have an increasing role in credit intermediation.
Manufacturing Expands at a Faster Rate, Drives Demand for Loans
When manufacturing expands, it’s a positive indicator for overall economic growth. Generally, it results in positive GDP growth.
Banks Set to Profit from Steepening Yield Curve
The yield curve has steepened a bit compared to where it was a week or even a month ago. Investors should consider the yield curve slope an indicator of bank performance.
Interest Rates : A Key Indicator for the Banking Sector
When interest rates rise, banks typically increase the interest they charge for loans faster than what they pay on deposits. This gives an immediate boost to their margins.
Why Does a Flattened Yield Curve Hurt Banks?
Banks benefit from a steeper yield curve, which allows banks to lend on higher long-term rates and borrow on lower short-term rates. This boosts banks’ margins.
Interest Rates Change: A Key Indicator for the Banking Sector
Lower interest rates on a sustained basis have negatively impacted the performance of the US banking sector. Banks are not able to use much deposit pricing strategies to boost margins.