Magazine article American Banker

Stocks: Banks Rise amid Forecasts They'll Keep on Doing So

Magazine article American Banker

Stocks: Banks Rise amid Forecasts They'll Keep on Doing So

Article excerpt

Bank stock analysts are jumping on the bullish bandwagon, with most predicting a rising market.

And the market for bank stocks was rising Tuesday. The Standard & Poor's bank index gained 0.33% and the Nasdaq bank index 0.9%, against dips of 0.04% for the Dow Jones industrial average and 0.22% for the S&P 500.

Among the gainers were Bank of America Corp., up 0.92% to $75.25; Chase Manhattan Corp., 1.18% to $86.625; and J.P. Morgan & Co., 2.25% to $145.0625.

Among regionals, KeyCorp was rose 0.19% to $32.50; Fifth Third Bancorp, 2.20% to $66.8125; and Firstar Corp, 0.43% to $28.9375.

Joseph Battipaglia, chairman of investment policy at Gruntal & Co., said he expects banks to report strong performance for the second quarter. He includes them among companies that will see a 15% or greater increase in profits.

But the market is expected to remain choppy despite such increases.

"We may see financial companies' stocks go up, but it won't be in a straight line," said Michael J. Schroeder, principal at Wasmer, Schroeder in Naples, Fla.

"Right now the market is feeling around for a leader," with bank stocks possibly taking that role because they are undervalued compared with other sectors, he said.

Union Planters Corp. had a solid day, rising 3.94% to $46.125. The Memphis banking company is finally being recognized by investors as a worthy addition to their portfolios, said Alan F. Morel, a banking analyst at J.J. Hilliard, W.L. Lyons.

"Everyone is starting to see the deeper story," Mr. …

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