Visa off ahead of bank earnings; financials rise

Shares of MasterCard Inc. and Visa Inc. remained weak on Wednesday, continuing a recent slide prompted earlier this week by analysts’ comments about the shares’ valuations.
Adding to pressure on the shares, analysts suggested that coming earnings reports from major banks that issue cards with the two firms may release information about their own card businesses that could affect the them.
“Privately held First Data’s final June SpendTrend data release showed a month-to-month deceleration in year-over-year volume growth, growing 6.4% with a rebound in debit spending not quite offsetting weaker credit results,” Jefferies analysts said in a Wednesday note.
J.P. Morgan Chase & Co. (US:JPM) is scheduled to report quarterly results on Friday, while Citigroup Inc. (US:C) , Bank of America Corp. (US:BAC) and U.S. Bancorp. (US:USB) are expected to report results next week.

Jefferies kept buy ratings on Visa and MasterCard, but qualified it by saying, “we acknowledge the potential cyclical impact of the fragile macro environment” on the shares.
MasterCard (US:MA) shares fell 0.7% while Visa (US:V), the worst S&P financial sector performer on Wednesday, fell 1.8%.
More broadly, the Financial Select Sector SPDR ETF (US:XLF), which tracks the financial stocks in the S&P 500 (US:SPX), rose 0.7%.
Financials represented in the Dow Jones Industrial Average (US:DJIA) were mixed, with Bank of America  and J.P. Morgan Chase & Co.rising, while American Express Co. (US:AXP) and Travelers Cos. Inc. (US:TRV) fell.

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URL:http://articles.marketwatch.com/2012-07-11/markets/32624596_1_banks-that-issue-cards-visa-and-mastercard-bank-earnings