Pros Say: Bank Profits Signal Recovery
Wall Street’s banking giants JPMorganChase and Goldman Sachs turned in better-than-expected earnings for the first quarter, leading many investors to hope that the beleaguered sector is over the worst of its troubles.
The traumatic times during the peak of the credit crisis are still fresh in market watchers’ memories and many will need more than one quarter’s numbers to call a bottom in the banks balance sheets.
But Cyrus Daruwala, managing director for Asia Pacific at Financial Insights, is making just such a call and told CNBC that the banking sector has turned a corner.
US Financials Turning Around
“I distinctly see a turnaround … the cost of capital has been significantly driven down. Banks could not lend because of the cost of capital,” Daruwala said.
Daruwala not only expects financials to recover, but the bear-market in stocks to be over.
Risk Appetite Is Moving Currencies
Risk appetite is moving currencies Adam Carr, senior economist at ICAP, tells CNBC. Carr is bullish on the US dollar, given that they're the epicenter of the major stimulus package.
A Recovery In Sight?
Henri de Castries, Chairman & CEO of AXA Group tells CNBC he sees a progressive recovery in Asia and the U.S.
Positive on Commodities
The outlook for the commodities sector is positive and will prove to be good for Australia, says Lucinda Chan, divisional director at Macquarie Private Wealth. She shares her investment strategy with CNBC.
Commodity Rally Is Not Sustainable
Risk appetite and Chinese buying are driving the commodities rally. But Tobias Merath, head of commodity research at Credit Suiss Private Banking tells CNBC that the rally is running out of steam.
Aggressive ECB Action Expected
Expect aggressive action from the ECB, says David Mann, FX strategist at Standard Chartered. He tells CNBC what he's expecting when ECB president Trichet speaks later.