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Tuesday, September 28, 2021
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US Big Banks are Strong, Dividends and Buybacks to Resume, Stock Indexes Rebalanced on Quad Witching

#banks #dividends #buybacks

$DIA $SPY $QQQ $RUTX

Quarterly rebalancing of S&P 500, annual reconstitution of the NAS Comp 100, Tesla (NASDAQ:TSLA) inclusion into the S&P 500 after the close, quadruple-witching options expired“– Paul Ebeling 

The big US banks have enough capital to withstand over $600-B in losses from a short, sharp economic slump, as well as a moderate longer-lasting downturn, and will be permitted to pay out dividends and buy back stock the Fed said Friday.

Friday the Fed released the results of its 2nd bank “stress test” for Y 2020 and found them solid.

The Fed had barred banks from buying back stock to help them build capital reserves during the coronavirus chaos.

The relaxed restrictions were met with announcements from JPMorgan Chase (NYSE:JPM) and Goldman Sachs (NYSE:GS) that they planned to buy back stock beginning in the Yew Year.

The results of the 2nd test of Y 2020, which the Fed pursued to reflect the severe economic impact of the virus chaos, found that banks suffered more severe losses than under the prior, pre-pandemic test.

But months of building up reserves helped ensure they were positioned to weather the downturn well, with firms building capital reserves in Y 2020 despite setting aside nearly $100-B in loan loss reserves.

The Fed found all firms remained above minimum capital requirements after taking the hypothetical losses, leading it to relax its restrictions on capital payouts, allowing them to buy back stock in Q-1 of Y 2021, after barring them that cholce in June.

The Fed, adhering to The Trump Policies, is backing America’s businesses and the economy.

Friday, the benchmark US major stock market indexes paused to refresh on heavy rebalancing volume and finished at: DJIA -124.32 at 30178.99, NAS Comp -9.11 at 12755.55, S&P 500 -13.07 at 3709.42

Volume: Trade came in heavy at 3.1-B/shares exchanged on the NYSE

HeffX-LTN’s overall technical outlook for the major US stock market indexes for the wk ending 18 December is Bullish with a Very Bullish bias.

  • NAS Comp +42.2% YTD
  • Russell 2000 +18.1% YTD
  • S&P 500 +14.8% YTD
  • DJIA +5.8% YTD

Looking Ahead: Investors will not receive any notable economic data Monday

Have a healthy weekend, Keep the Faith!

Paul Ebeling
Paul A. Ebeling, a polymath, excels, in diverse fields of knowledge Including Pattern Recognition Analysis in Equities, Commodities and Foreign Exchange, and he is the author of "The Red Roadmaster's Technical Report on the US Major Market Indices, a highly regarded, weekly financial market commentary. He is a philosopher, issuing insights on a wide range of subjects to over a million cohorts. An international audience of opinion makers, business leaders, and global organizations recognize Ebeling as an expert.   

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