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Are Traders Expecting Too Much from Bank Buybacks?

US Bancorp barely moves in after-hours trading, after announcing 100 million share buyback (about $3 billion) and raising its dividend 56 percent.

Other banks that announced dividend increases and buybacks are also barely moving in the after hours. Many banks moved 5 percent in the final hour of trading on JPMorgan's dividend hike and buyback.

Four failed the stress test, all are trading down in after hours: Suntrust , Citigroup , MetLife , Ally Financial , need more capital.

JPMorgan: best on the block! You didn't think passing a Fed stress test would yield such good news did you? JPMorgan said they passed theirs, and as a result are raising the dividend 5 cents to $0.30 a quarter and...more importantly...instituting a huge $15 billion buyback.

How big is $15 billion? They are only expected to earn about $18 billion this year.

"JPM is the BEST house on the hill," one trader wrote to me.

Meantime, watch the 10-year Treasury yields: 2.12 percent, highest since October. The Fed has a problem on its hands: it is committed to keeping rates low until 2014, but if the global economy continues to show signs of modest improvement the Fed may have a lot of problems containing the coiled spring that is Treasury yields.

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