Rates are generally even on today’s market news which includes bank earnings and some housing data, as follows: Wells Fargo’s earnings came out as expected at $3.2 billion (61 cents per share). Initial reads show that Wells’ loan growth was better than expected. Credit quality improved dramatically, allowing Wells to release some $850 million in reserves which is about 10 cents per share. Goldman Sachs also came out slightly better than expected at $3.79 per share versus $3.76 per share, although revenue came in lower than expected. Goldman did not have a monumental quarter, as some were hoping. US Bank reported its earnings at 49 cents per share, slightly better than the 46 cents per share expected. The bank also reported a provision for credit losses lower than net charge-offs by $25 million and net securities losses of $14 million, which increased earnings per common share by three cents in the fourth quarter.
We also had Housing Starts and Building Permits for December; starts were expected to decline and permits pick up. Starts were indeed down 4.3%, possibly with some influence from weather, and permits were up 16.7%. Regardless, housing is slow, and continues to grapple with a foreclosure overhang.