Wells Fargo's (WFC) Q3 profit rose 6% as revenue climbed 10%, but both missed analyst estimates. Ongoing home and loan woes would hurt its Q4 results. KeyCorp (KEY) also missed Q3 views and warned on Q4. US Bancorp (USB) topped EPS views by a penny as it lifted loan-loss reserves by 47%. Its shares edged down; KeyCorp fell 5% and Wells Fargo 4%.
It looks as though the market is paying attention to the increasing number of Q4 warnings.
The XLF ETF has broken its recent uptrend on higher volume. The ETF is still below the 200 day SMA and prices have fallen through the 50 day SMA.
The regional bankshares ETF is also falling, and has been since early October. The ETF is still below the 200 day SMA and prices are below the 50 day SMA.
Remember that financial shares represent about 20% o the S%P 500. That means this action will make it harder for the SPYs to advance.
