The Financial sector could get even more volatile with earnings reports coming out from the heavy hitters this week. US Bancorp (USB, $31.67, down $0.95) gets the ball rolling Tuesday before the bell and Wall Street is expecting the company to report earnings of 61 cents a share. US Bancorp is viewed as a “safer” play in the industry because it didn’t have as much exposure to the mortgage lending business like many other firms. However, yesterday’s drop of 3% could be a sign that a break below $30 is possible.
JPMorgan Chase (JPM, $41.50, down $1.03) reports Wednesday. The stock has performed well since the company announced its plans to buy Bear Stearns about a month ago rising from $34 to a high of $47 but has drifted lower over the last seven trading sessions. Average estimates call for the company to earn 66 cents per share. Wells Fargo (WFC, $27.20, down $0.77) also reports Wednesday, Merrill Lynch (MER, $42.88, down $0.80) on Thursday and Citigroup (C, $22.51, down $0.85) will announce its earnings Friday.
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The news from the Financial sector will certainly impact the market and likely set the mood for the next couple of weeks. If negativity remains in the headlines, the Dow could be headed below 12,000.