Wall Street is enjoying a massive reprieve this week thanks to another sudden dovish turn by the Federal Reserve. Chairman Jerome Powell hinted on Tuesday that because of the economic drag from political tensions and the deepening trade rift between the United States and its partners, the central bank was ready to stimulate the economy as needed.
This was a salve to the raw nerves in the market, as worries including heightened regulatory attention on the big tech stocks pushed the Dow Jones Industrial Average back to levels not seen since January. But now, the index is once again challenging its 200-day moving average.
With interest rates already so low and evidence of a manufacturing slowdown already under way, there isn’t a lot of room for the Fed to make any policy mistakes. The market is calling for lower rates, with futures assigning near certainty that rate cuts happen this year. That is something that would bolster bank net interest margins.
No wonder these four big bank stocks are perking up so well:
Bank Stocks to Buy: JPMorgan Chase (JPM)
Shares of JPMorgan Chase (NYSE:JPM) have bounced off of their 200-day moving average to take the fight to the 50-day average, recovering from a test of its early April lows. Shares are down roughly 6% from their recent high and remain mired in a two-year consolidation range. The company has been in the news recently for allegedly closing the accounts of conservative activists.
The company will next report results on July 16 before the bell. Analysts are looking for earnings of $2.54 per share on revenues of $28.8 billion. When the company last reported on April 12, earnings of $2.65 beat estimates by 30 cents on a 4.4% rise in revenues.
Citigroup (NYSE:C) shares have popped back up and over their 200-day moving average, bouncing off of a strong range of support near the $60-a-share level. Shares remain mired in the depths of a three-year-long sideways range but should be good for a test of prior highs near $70. That would be worth a gain of more than 9% from here.
The company will next report results on July 15 before the bell. Analysts are looking for earnings of $1.88 per share on revenues of $18.8 billion. When the company last reported on April 15, earnings of $1.87 beat estimates by eight cents on a 1.6% drop in revenues.
Bank of America (BAC)
Bank of America (NYSE:BAC) shares are bouncing off of their late-March lows to rebound towards their 200-day and 50-day moving averages. This continues a two-year-long sideways channel going back to early 2018. The move comes despite a recent downgrade from analysts at Atlantic Equities.
The company will next report results on July 17 before the bell. Analysts are looking for earnings of 72 cents per share on revenues of $23.4 billion. When the company last reported on April 16, earnings of 70 cents per share beat estimates by four cents on a 0.4% decline in revenues.
Goldman Sachs (GS)
Shares of Goldman Sachs (NYSE:GS) are finding support near the March low around $185, setting up another run at overhead resistance near its 200-day moving average — a level that turned the bulls back in April and May. The level also foiled the bulls back in the summer of 2018, so a breakout would trigger a lot of program buying.
The company will next report results on July 16 before the bell. Analysts are looking for earnings of $5.46 per share on revenues of $9.2 billion. When the company last reported on April 15, earnings of $5.71 beat estimates by 69 cents on a 12.6% decline in revenues.
As of this writing, William Roth did not hold a position in any of the aforementioned securities.