Cohn also said that the executive order could pave the way for additional orders that would affect the postcrisis Financial Stability Oversight Council, the committee overseeing the winding down of a giant faltering financial company and the way the government supervises large financial companies that aren’t traditional banks.
“Bank earnings improved in the quarter from higher trading activity, improved net interest margins, expense control and lower credit costs, however loan growth remains weak, which may impede material near-term earnings improvement,” said Julie Solar, Senior Director, Fitch Ratings, in a recent note.
XLF is coming off one of its best annual performances since the global financial crisis. While the financial services sector, the second-largest sector allocation in the S&P 500, has some doubters after last year’s impressive rally, some market observers believe the sector can keep tracking higher this year.
According to Thomson Reuters, the combined profit of S&P 500 companies is projected to have returned 6.2% in the fourth quarter, largely due to improving results out of the financial sector.
For more information on the financial sector, visit our financial category.