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Bank Earnings—Now, The Bad News...

Asia is lower as China raised down-payment requirements on second homes (to 50 percent from 40 percent).

Housing starts and permits for March were above expectations, but the gains were entirely due to multifamily construction. February was revised upward. Permits saw gains from both single and multifamily, which would not be surprising, since the home buyer tax credit expires April 30th.

Earnings continue to come in better than expected, but more importantly revenues are improving. Miller Tabak noted that of 19 companies in the S&P 500 reporting as of last night, 14 companies that have reported better than expected results and 4 have reported weaker than expected results.

Elsewhere:

1) CNBC's parent company, General Electric, reported earnings from continuing operations of $0.21 (consensus $0.16). Most importantly, GE Capital appears to be stabilizing.

GE is up nearly 25 percent in the last three weeks.

2) Bank of America reported earnings of $0.28, better than consensus of $0.09.

The good news: a) capital markets were strong, with strength in fixed income and equity trading, b) credit trends improved and c) capital levels at 7.6 percent of Tier 1 common were also good.

The bad news: total loans for both consumer and commercial were down, deposit growth appears to be flat, and there is continuing large losses on home equity loans.

The bigger problem: big price moves in banks this week may create limited upside. BAC up 4.8 percent this week, largely on the heels of JPMorgan's stellar report.

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