Health care stocks and exchange traded funds (ETFs) have gained appeal as the special election in Massachusetts threatens to strip power from Senate Democrats. Earnings from Citigroup (NYSE: C) and IBM (NYSE: IBM) could also give the markets some signals about where the economy is headed.
Today’s vote to fill the seat of late Sen. Edward M. Kennedy could shift power in the Senate. That could disrupt plans to expand access to health care and make it harder for President Barack Obama to make further changes to health care, which threatened insurers and drug markets, reports Associated Press on Yahoo Finance. The ultimate vote could have an impact on health care ETFs.
- iShares Dow Jones U.S. Healthcare (NYSEArca: IYH)
Citigroup (NYSE: C) reported a $7.77 billion fourth-quarter loss due to failed loans and the costs of repaying government bailout money, which is more evidence of the general problems with consumer credit. The bank said Tuesday it did see some early signs of improvement in its credit business, although it still needed to set aside $8.18 billion to cover unpaid loans, reports Associated Press. Financial Select Sector SPDR (NYSE: XLF) is up more than 1% this morning; Citigroup is 4% of the fund.
JPMorgan Chase & Co. (NYSE: JPM) reported Friday that it earned $3.28 billion during the fourth quarter, thanks to its strong investment banking unit. When and how much is left to keep adding to loan reserves is up in the air. The bank’s loss after accounting for payment of preferred dividends came to almost $7.77 billion, or 33 cents per share.
IBM (NYSE: IBM) is set to report fourth quarter earnings later today, as investors look for signs that the company is able to raise its revenue higher than last year. IBM is also helping iPhones go corporate this week, with the introduction of a free plug-in that allows Notes users to read their encrypted e-mail on the Apple smartphone. David Coursey for PC World reports that BlackBerry-maker Research In Motion said it was licensing Connections for use among its own employees. IBM, meanwhile, announced that, for the first time, it would begin selling BlackBerry hardware to its corporate customers.
First Trust NASDAQ-100 Technology Index (NASDAQ: QTEC) is up nearly 1% this morning.
Look for more clues about the financial sector’s health tomorrow: Morgan Stanley (NYSE: MS) and Wells Fargo (NYSE: WFC) are scheduled to report earnings before the opening bell.
For more stories about the financial sector, go to our financial category.
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.