Financials Up Ahead of Earnings as Treasury Yields Rise -- Financials Roundup

Banks, lenders and other financial companies rose ahead of earnings reports later in the week, as the 10-year Treasury yield hit a near 10-month high. The Financial Select Sector SPDR (XLF) exchange-traded fund, which tracks the price of the financial stocks in the Standard & Poor's 500, rose by more than 1% and came within 5% of a record high set in 2007, as investors bet that banks would report sanguine earnings situation in a round of reports starting later this week. By some measures, investor sentiment in the U.S. has moved into "euphoric" territory after months of steady gains. Other indicators, however, suggest there are more gains ahead before complacency sets in, according to one brokerage. "US sentiment bullish readings and the bull-bear spread have soared signaling the first signs of euphoria but fund flows suggest investors have failed to back their instinct," said analysts at brokerage Jefferies, in a research note. "The technical picture is bullish with more stocks making new highs than new lows." Goldman Sachs Group Inc. (GS) plans to lend $4 million to bankrupt distressed-business buyer Real Industry Inc. (RELYQ) and to eventually spend about $10 million to buy common stock in the publicly traded company, which is sitting on almost $1 billion in potential tax benefits, thanks to Real Industry's investment approach.

-Rob Curran, [e-mail]

(END) Dow Jones Newswires

January 09, 2018 16:14 ET (21:14 GMT)

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