This week the banking sector will still be recovering from the shell shock created by the bomb Bank of America (NYSE: BAC ) dropped on the market last Monday. The big lender made errors in reporting certain capital figures, and said it was suspending its dividend and share buyback program as per a request from the Federal Reserve. Bank of America stock dropped notably after that ugly piece of news, and has yet to fully recover.
It's probably not the best time, then, to hold an annual shareholder meeting. But that's exactly what's going down on Wednesday morning,and since the announcement is still fresh Bank of America's confab might feature some very contentious moments. For those who want to witness the fun, it's being webcast live on the day.
Bank of America's lousy news allowed JPMorgan Chase (NYSE: JPM ) to slip in its own unhappy revelation at the very end of last week. Friday night, the company said it expects its crucial markets (read: investment banking) revenue to decline by 20% on a year-over-year basis in the current Q2.
That follows the already-steep 18% tumble the firm recorded in its market and investor services segment in Q1. In that quarter, the segment's revenue came in at $5.9 billion. This was almost one-quarter of JPMorgan Chase's total top line, so a drop on the order of 20% is certainly going to hurt.
At least JPMorgan Chase currently pays a dividend, in contrast to stumbling Bank of America. Other dividends in the sector will be teed up over the next few days, specifically from Citigroup (NYSE: C ) and Wells Fargo (NYSE: WFC ) . Both lenders have their record dates this week; Citi's is today, while that for Wells Fargo is Friday. The former is handing out its customary (since 2009, anyway) $0.01 per share, while Wells Fargo is dispensing $0.35, or $0.05 higher than its previous payout.
Zooming out a bit, Fed Chair Janet Yellen will take her latest turns in the spotlight. She's to make a pair of testimonies to Congress, the first to the Joint Economic Committee on Wednesday, and the second to the Senate Budget Committee the following day. She'll get the usual quizzing about the continued wind-down of the regulator's quantitative easing, and general queries on the state of the economy. The Fed's policy of keeping interest rates skinny and eventually shuttering the current QE are quite clear these days, so we shouldn't expect anything too unexpected to fly from her mouth.
That would help to boost the confidence of the market. Particularly in the banking world, morale could use a lift after the Bank of America shocker and the JPMorgan Chase admission. Investors will be hoping for more positive news from the big lenders this week... or at least fewer stink bombs.
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