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Financial Sector Update for 02/15/2018: ARES,NTB,BXP,DB


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Financial stocks were edging narrowly higher Thursday afternoon, with the NYSE Financial Sector Index rising about 0.2% while financial companies in the S&P 500 Index were climbing nearly 0.1%. Also, the Philadelphia Housing Sector Index was up almost 0.1%.

In economic news:

In economic data, first-time jobless claims rose by 9,000 applications during the week ended Feb. 10 compared with the prior week but remained near historic lows of 230,000 initial applications for unemployment benefits. The four-week rolling average came in at 228,500. Applications last week were roughly 15,000 lower compared with the same week in 2017. Continuing claims also rose by 15,000 to a still very low 1.942 million claims during the seven days ended Feb. 3.

Also, separate reports continued to show strong manufacturing activity in New York state along with the mid-Atlantic coastal region. The Empire State Manufacturing survey conducted by the New York Fed showed a 13.1 reading for February, although that was down from a revised 17.7 reading for the prior month and trailed expert opinion looking for a 17.5 February score. The Philadelpia Fed's survey of general business conditions rose to a 25.8 reading for February from January's 22.2 reading, beating the top-end of the 19.0 to 24.7 forecast range.

Confidence among home-builders also remains extremely upbeat, with the National Association of Home Builders' monthly survey coming in at an as-expected 72 reading in February and unchanged from January. Traffic remains steady with a 54 reading, suggesting first-time buyers are coming into the market. Current and future sales also remain unusually strong, at 79 and 78 respectively.

Among financial stocks moving on news:

+ Ares Management ( ARES ) raced to a new record high on Thursday, climbing more than 13% to a best-ever high of $25.75 per unit after the company reported Q4 revenue trailing year-ago comparisons as well as Wall Street expectations and better-than-expected economic net income. Revenue declined to $356.3 million during the three months ended Dec. 31, down from 358.2 million during the same quarter last year and lagging the Capital IQ consensus expecting $376.4 million in revenue. The alternative asset manager recorded economic net income of of $0.54 per unit, up from $0.44 a year ago and exceeding the $0.48 per unit analyst mean.

In other sector news:

+ Bank of N.T. Butterfield & Son ( NTB ) rose more than 10% on Thursday, reaching a session high of $40.27 a share, after the financial-services company announced a deal to acquire Deutsche Bank's ( DB ) banking and custody business in the Cayman Islands, Jersey and Guernsey, which primarily serves financial intermediaries and corporate clients. Financial terms of the proposed transaction were not disclosed although the companies said they expect the deal to close in stages during 2018, subject to regulatory approvals.

+ Boston Properties ( BXP ) advanced Thursday after analysts at Bank of America Merrill Lynch raised their investment rating for the real estate investment trust to Buy from Neutral and set a $145 price target for the company's stock.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Investing , Banking and loans
Referenced Symbols: ARES , NTB , DB , BXP



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