• Subscribe
  • Log In
  • Home
  • Daily Diary
  • Asset Class
    • U.S. Equity
    • Fixed Income
    • Global Equity
    • Commodities
    • Currencies
  • Sector
    • Basic Materials
    • Consumer Discretionary
    • Consumer Staples
    • Energy
    • Financial Services
    • Healthcare
    • Industrials
    • Real Estate
    • Technology
    • Telecom Services
    • Transportation
    • Utilities
  • Latest
    • Articles
    • Video
    • Columnist Conversations
    • Best Ideas
    • Stock of the Day
  • Street Notes
  • Authors
    • Doug Kass
    • Bruce Kamich
    • Jim Cramer
    • Jim "Rev Shark" DePorre
    • Helene Meisler
    • Jonathan Heller
    • - See All -
  • Options
  • RMPIA
  • Switch Product
    • Action Alerts PLUS
    • Quant Ratings
    • Real Money
    • Real Money Pro
    • Retirement
    • Stocks Under $10
    • TheStreet
    • Top Stocks
    • Trifecta Stocks
  1. Home
  2. / Investing
  3. / Financial Services

The Best Charts in the Book Are All in Breakout Mode

The strongest sector right now is benefiting from interest rates talk.
By JIM CRAMER
May 18, 2015 | 05:53 AM EDT
Stocks quotes in this article: BK, JPM, PNC, KEY, FHN, FITB, HBAN, SNV, AIG, SCHW, ETFC, ICE, NTRS, WFC, RDN, MTG, MBI, COF, MA, V, AXP, DFS, DST, FISV, EFX, MHFI, INTU, MORN

Nothing like the charts to pore over on a cloudy weekend, where you can look with care at each pictograph and make some decisions about what's really happening and what isn't.

Let me give you some observations from this mountainous perusal.

First, despite the inability of the 10-year to punch through 2.4%, the financials, which need higher rates like California needs rain, are flying. They are the best charts in the book and are almost all in breakout mode.

There are big banks that look terrific, like Bank of New York (BK), JPMorgan (JPM) and PNC (PNC). There are regionals that seem irrepressible, namely, Key (KEY), First Horizon (FHN), Fifth Third (FITB), Huntington (HBAN) and Synovus (SNV). Both of these segments would not be going up if comparisons were getting harder. In fact, you could craft a thesis that all investors might care about is the end to net interest margin compression and we will begin to lap easier comparisons, so that's certainly possible.

There aren't many insurers that look all that special, with AIG (AIG) leading the list. The brokers seem incredibly strong, especially Schwab (SCHW) and E*Trade (ETFC). They, too, react to higher rates and I find their strength a little more puzzling than the banks', because it isn't like people are beating down the doors to trade stocks. Intercontinental (ICE) retains its luster as a brutal consolidator. What a stock! The hybrid that is Northern Trust (NTRS) acts incredibly well, too.  

Given what John Stumpf, CEO of Wells Fargo (WFC) calls the "muted" housing recovery, I was surprised to see so many mortgage insurers in the breakout stage, namely Radian (RDN), MGIC (MTG) and MBIA (MBI). I always thought it was incredible that the latter two survived at all. Radian remains an excellent company. Perhaps this resurgence simply comes because the Feds are pulling out of the insurance business.

Of course, the chicken way to play financials never seems to go out of style. The usual credit card companies, Capital One (COF), MasterCard (MA) and Visa (V), are strong. Portfolio managers have hidden in these three for years. American Express (AXP), even after that big buyback and Discover (DFS), don't seem to be tempting at all.

Lots of ancillary fins just keep going higher. Outsourcers like DST (DST), Fiserv (FISV), Equifax (EFX) always seem to be on the plus side, the latter kind of a total perennial.

I could go on and on with the love shown to this group, including stocks like McGraw Hill (MHFI), Intuit (INTU) and Morningstar (MORN), but the real point is that this whole sector is not only strong, it is by far the strongest, as people keep positioning themselves for the inevitable move higher in rates. 

(You can read Part 2 of this article here)

Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.

Action Alerts PLUS, which Cramer co-manages as a charitable trust, is long WFC, MA.

TAGS: Investing | U.S. Equity | Financial Services | Stocks

More from Financial Services

Wells Fargo's Quant Downgrade Signals the Stagecoach May Be Slowing Down

Bruce Kamich
Feb 25, 2021 12:23 PM EST

This is a good time to check out the charts of WFC.

Upwork Needs Some Consolidation Before Renewed Gains

Bruce Kamich
Feb 25, 2021 9:05 AM EST

The shares have made a good run since early April.

Brink's Safely Delivers an Upside Breakout

Bruce Kamich
Feb 24, 2021 8:30 AM EST

Here's how to play BCO stock.

Tyme for Asia as HSBC and South African Online Bank Expand

Alex Frew McMillan
Feb 24, 2021 7:30 AM EST

Europe's biggest bank, HSBC, is in an impossible political situation, caught between London and Hong Kong. South Africa's TymeBank will have it easier expanding into the Philippines.

Square Reports Tuesday, Be Ready to Take Profits

Bruce Kamich
Feb 22, 2021 9:48 AM EST

Now that prices are within striking distance of our target, let's review the charts.

Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation. If you have questions, please contact us here.

Email

CANCEL
SUBMIT

Email sent

Thank you, your email to has been sent successfully.

DONE

Oops!

We're sorry. There was a problem trying to send your email to .
Please contact customer support to let us know.

DONE

Please Join or Log In to Email Our Authors.

Email Real Money's Wall Street Pros for further analysis and insight

Already a Subscriber? Login

Columnist Conversation

  • 11:51 AM EST REAL MONEY

    Watch Bob Lang and Doug Kass Discuss Short-Selling!

    Bob Lang and Doug Kass with an engaging and educat...
  • 11:32 AM EST JAMES "REV SHARK" DEPORRE

    This Weekend on Real Money

    Navigating a Market Correction
  • 11:29 AM EST GARY BERMAN

    Where Does the Nasdaq Go From Here?

    Where does the Nasdaq Composite (CCMP) index go fr...
  • See More

COLUMNIST TWEETS

  • A Twitter List by realmoney
About Privacy Terms of Use

© 1996-2021 TheStreet, Inc., 225 Liberty Street, 27th Floor, New York, NY 10281

Need Help? Contact Customer Service

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data & Company fundamental data provided by FactSet. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by FactSet Digital Solutions Group.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

FactSet calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.

Compare Brokers

Please Join or Log In to manage and receive alerts.

Follow Real Money's Wall Street Pros to receive real-time investing alerts

Already a Subscriber? Login