Shares of Visa Inc and MasterCard Inc continued to remain weak, following a recent slide which was prompted earlier this week by analysts on share valuations.
Adding a further pressure on the stocks, the analysts said that in the coming earnings reports the big banks which are presently issuing cards with these two firms might make a declaration of their own card business . This will definitely impact the businesses of the two firms, which was reflected in the share trading today.
A recent report on the business of these firms reflected a deceleration in the year over year volume growth , which stood at 6.4 per cent, which was a rebound in debit spending but not quite offsetting the credit results which were weak. JPMorgan Chase & Co is likely to report its earnings for the quarter on Friday while Bank of America Corp, Citigroup and US BankCorp are scheduled to report the earnings data in the next week.
The ratings on both MasterCard and Visa were kept at buy by Jefferies but it was qualified by saying that there was a potential cyclical impact of the macro environment which is very fragile. Shares of MasterCard were down by 0.7 per cent while those of Visa , in the worst sectoral performance on the S&P for the day, was down by 1.8 per cent.
In the broader market, the Financial Select Sector SPDR ETF, which usually tracks the financial stocks on the S&P 500, was up by 0.7 per cent. The performance of the financials on the Dow Jones Industrial Average was mixed with Bank of America and JPMorgan rising, while American Express Co and Travelers Cos Inc were down.