Bank Earnings Not Helping Equities

Cathie Wood on Brunell, QTR FringeFinance

We have a slew of bank earnings today JPM, WFC and Citibank all beating estimates, which really shouldn’t be a surprise as the big banks harbor all the deposits and we know they are making a ton of interest given the level of rates. When we look at JPM their Q3 Net Interest Income was up 30% YoY to $22.9Bn, I guess it pays to invest in higher yields and charge higher rates, all the while paying out pennies on the dollar to your depositors. In a world where credit card rates average is at its highest levels ever at 21%, JPM enjoys paying out on average 2.53%, so higher rates seem to be benefit the big bank. JPM is currently +$2.96 (2.04%) but still struggling with the $150 area:

We will stick with our equity theme here and take a look at the QQQs which saw 373 resistance cap everything this week and we believer that it is putting in a major topping pattern that has played out over the last 4 months. We believe the real leg lower will come on a breach of 346 and for now the descending wedge pattern is still in control:

Another stock we watch is Chipotle and we have seen an attempt to raise prices here in the short term to boost profits will end up failing miserably and we believe the equity will continue to suffer and a breach of $1772 should lead to an attack on the $1700 longer term topping level. Should that give way, well, a major slide would indicate a move to $1000: