Financial Sector Update for 03/07/2018: WHLR,RBS,SPGI

Top Financial Stocks

JPM -1.67%

BAC -.92%

WFC -1.51%

C -1.44%

USB -1.87%

Financial stocks were mostly lower Wednesday afternoon, with the NYSE Financial Sector Index sinking over 0.7% while financial companies in the S&P 500 Index were falling almost 1.2%. Also, the Philadelphia Housing Sector Index was declining more than 0.4%.

In economic news:

The US trade deficit widened sharply during January to $56.6 billion, likely providing President Donald Trump with additional ammunition in his plan to place tariffs on imported steel and aluminum. Imports were little changed during January from the previous month at $257.5 billion while exports declined 1.3% to $200.9 billion. Exports of capital goods fell by $2.6 billion, or about 5.5%, to $44.9 billion, largely due to a 32% drop of $1.8 billion in civilian aircraft exports to $3.8 billion. Exports of industrial supplies, which includes primary metals, decreased just over 30% to $41.5 billion. Petroleum imports increased by $2.2 billion to $13.2 billion.

Also Wednesday, payroll processor ADP ( ADP ) said private-sector employers hired 235,000 new workers in February, topping expert opinion looking for around 205,000 hires last month. January employment also was revised slightly higher from initial estimates, climbing to 244,000 from 234,000 new employees first reported for the month.

Later this afternoon, the US Federal Reserve takes center stage, with the central bank releasing its Beige Book assessment of economic conditions in its 12 member districts as well as nationally at 2 pm ET. The Fed also is scheduled to issue its weekly assessment of consumer credit activity at 3 pm ET.

Among financial stocks moving on news:

- The Wheeler Real Estate Investment Trust ( WHLR ) plunged to a record low on Wednesday, sinking at one point over 26% to a worst-ever $3.67 a share, after late Tuesday reporting a Q4 net loss of $1.22 per share, expanding from a $0.73 per share loss during the same quarter last year and missing the two-analyst consensus looking for a net loss of $0.56 per share. Total revenue from continuing operations increased by 18.9% to $14.3 million from $12.0 million during the year-ago period, roughly in-line with the mean call of the two analysts polled by Capital IQ. Excluding one-time items, Wheeler also recorded non-GAAP Q4 funds from operations of $0.18 per share, improving on adjused FFO of $0.16 per share last year.

In other sector news:

- Royal Bank of Scotland ( RBS ) was little changed Wednesday, recovering from a 0.5% decline to a session low of $7.36 a share soon after the opening bell, after the UK financial services company reached $500 million agreement with the state of New York to settle allegations of "deceptive practices and misrepresentations to investors" on residential mortgage-backed securities, New York Attorney General Eric T. Schneiderman said. The settlement includes a $100 million cash payment to the state and $400 million of consumer relief for homeowners and communities. Schneiderman previously settled with five other large banks, generating $3.7 billion in fines and restitution to consumers, for their roles in the 2008-'09 financial crisis.

- S&P Global ( SPGI ) was trading lower Wednesday, with shares of the financial analytics firm receiving little apparent help from its after-market announcement Tuesday night it has entered into a $1 billion accelerated share buyback agreement with Morgan Stanley. The transaction is expected to close before the end of March and S&P Global said it will use available cash to fund the upcoming transaction. The new stock buyback is being executed under the company's existing board authorization, it said, adding it expects to pay out at least 75% of its free cash flow to shareholders in 2018 through dividends payment and stock buybacks.

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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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