Magazine article American Banker

Stocks: Air Attacks on Yugoslavia Send Chill through Market

Magazine article American Banker

Stocks: Air Attacks on Yugoslavia Send Chill through Market

Article excerpt

Bank stocks were caught up Friday in market reaction to the NATO allies' renewed attacks in Yugoslavia.

"The market is reacting to what's going on in Kosovo," said Charles W. Johnson, head equity trader for Blaylock & Partners in New York. "In many cases, you're seeing folks moving away from stocks and into more stable assets like money markets and the long bond."

Among the large banks, Citigroup gained 43.75 cents to $63.4375 and J.P. Morgan & Co. 75 cents, to $122.875. Chase Manhattan Corp. dipped $1, to $80.50.

The Standard & Poor's bank index lost 1.27% and the Dow Jones industrial average 0.14%. The S&P 500 was off 0.56% and the Nasdaq bank index 0.92%.

Mr. Johnson said the market could "very quickly reverse if we get this situation in Europe resolved. Interest rates are fairly benign, which has acted to remove concern about the Fed taking action."

Now is the opportunity for investors to get into bank stocks, said Benjamin C. Bishop, a banking analyst with Allen C. Ewing & Co. of Jacksonville, Fla.

"As people realize earnings will improve nicely in 1999, bank stocks should be looked upon with favor," Mr. Bishop said.

Shares of First Union Corp. were off 43.75 cents, to $53.75, despite an upbeat report from Richard X. Bove, a banking analyst at Raymond James Associates.

Mr. Bove raised his rating on the shares from "accumulate" to "buy" and increased his earnings per share estimate to $4, from $3.85.

One of the drivers is the Charlotte, N. …

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