Today, the nation’s major financial institutions report earnings as the rest of the country looks for more clues about the pace and depth of the recovery. In the end, results were mixed, but stocks and exchange traded funds (ETFs) are roundly lower.

Bank of America (NYSE: BAC) was the most disappointing, reporting a $5.2 billion loss during the fourth quarter. The bank said the losses were the result of both consumers struggling to repay credit cards and mortgages, as well as it’s own repayment of the TARP bailout money. A year earlier, the bank lost $2.4 billion, says Ieva M. Augstums for the Associated Press. [12 plays for 10 surprises.]

Other earnings include:

  • Wells Fargo (NYSE: WFC) was a standout, reporting a quarterly profit of $3 billion. The bank raised $12 billion selling new shares in December in order to repay the $25 billion TARP loan, reports Alistair Barr for MarketWatch.
  • Morgan Stanley (NYSE: MS) showed that it’s still struggling to recover, saying that a decline in trading revenue sent fourth quarter profits down to $617 million. The results were short of analysts’ projections, says Joe Bel Bruno for The Wall Street Journal.

The Financial Select Sector SPDR (NYSEArca: XLF) is down about 1% this morning; Bank of America is 9.4%; Morgan Stanley is 3.3%; Wells Fargo is 9.6%.

Health care ETFs are down today, despite a stunning victory for Republicans in Massachusetts. Scott Brown won the race against Democrat Martha Coakley 52% to 47%, costing Democrats their 60-vote majority, report Greg Hitt and Peter Wallsten for The Wall Street Journal. Brown has been an opponent of health care legislation, and many fear it’s a death knell for the effort. Vanguard Health Care (NYSEArca: VHT) is down more than 1% this morning. [The case for investing in health care.]

Home construction declined a sharp 4% in December. Economists blamed the decline primarily in cold and wet weather in many areas of the country. The true bright spot is building permits, which rose 10.9% last month, which is the highest level in a year, reports Javier C. Hernandez for The New York Times. iShares Dow Jones U.S. Home Construction (NYSEArca: ITB) is down nearly 2% this morning. [Commercial real estate at the bottom?]

Producer prices rose slightly by 0.2% last month based primarily on food prices, which saw their largest year-on-year gain since October 2008.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.