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It's early in the trading week, but it is apparent that the banking sector is still gleaming from the decent jobs report last Friday, which revealed that nearly 200,000 new jobs were added to the economy in June. Though the report was far from perfect, the unexpected increase in employment gave rise to a Wall Street cheer that buoyed the stocks of Bank of America (NYSE: BAC ) , Citigroup (NYSE: C ) , JPMorgan Chase (NYSE: JPM ) , and Wells Fargo (NYSE: WFC ) -- as well as the Dow and S&P 500.
All of the above are still aglow by mid-morning, with Bank of America up nearly 1% so far. I feel sure that the residual good feelings regarding the employment report will linger throughout the day, keep the banking sector safely in the green. Despite the fact that the happy news could cause another spike in mortgage rates, which would likely affect Wells, JPMorgan, and B of A, positivity will probably reign, at least for today.
The hiatus is over: Article 77 hearing continues
Another issue that could catapult Bank of America higher today is the resumption of the Article 77 hearing in Manhattan, where the fate of a $8.5 billion settlement between the big bank and 22 institutional investors hangs in the balance. Despite the suggestion of the judge presiding over the case, and the desire of settlement objectors, no talks ensued regarding this matter during the nearly one-month haitus.
As I mentioned in an earlier article, B of A was dead-set against negotiating with AIG (NYSE: AIG ) and other objectors, which looked a little like they were begging for scraps. AIG, which refused to sit in on talks regarding this issue two years ago, was unable to sway Bank of America, which apparently feels that it will prevail in keeping the agreed-upon settlement amount intact. Do investors feel the same? I'm betting they do, and it will show in the bank's share price -- beginning today.
As Bank of America surges ahead, investors have cause to celebrate. At the same time, however, it is important to remember that outside influences such as the jobs report can have a fleeting effect on a bank's stock price. As Foolish, long-term investors, we recognize the fact that one-day changes in share price don't make or break an investment. Even stocks have good days and bad days, so it's important to realize that sometimes they're not portents of dire news, but merely squiggles we can safely ignore.
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