Westpac Banking Corporation and Other Financial Stocks Making Big Moves on October 19, 2012

The morning has been bad for the market. The Nasdaq has fallen 1.6%; the S&P 500 has slipped 1%; and the Dow has declined 1.1%. The financial sector is the category of stocks containing firms that provide financial services to commercial and retail customers. This sector includes banks, investment funds, insurance companies and real estate. Financial services perform best in low interest rate environments. A large portion of this sector generates revenue from mortgages and loans, which gain value as interest rates drop. Furthermore, when the business cycle is in an upswing, the financial sector benefits from additional investments. Improved economic conditions usually lead to more capital projects and increased personal investing. New projects require financing, which usually leads to a larger number of loans.

The Financial sector (XLF) is currently ahead of the overall market, down only 0.8%, and its biggest movers are currently:

Company	Market Cap	Percentage Change
Capital One (NYSE:COF)	$33.29 billion	+5.8%
City (NYSE:CYN)	$2.62 billion	+3.4%
Deutsche (NYSE:DB)	$42.55 billion	-3.3%
Prudential (NYSE:PRU)	$27.91 billion	-3.3%
Associated (Nasdaq:ASBC)	$2.16 billion	+2.9%
Home Loan Servicing (Nasdaq:HLSS)	$568.9 million	+2.7%
Westpac Banking Corporation (NYSE:WBK)	$81.75 billion	-2.7%

Broker Summary: Fidelity Online Brokerage

Capital One (NYSE:COF) is currently trading at $60.64 per share, a 5.8% increase. So far today, the company's volume is 6.2 million shares.

City (NYSE:CYN) has increased to a share price of $50.49, a 3.4% rise. The company's volume is currently 501,035 shares for the day, 1.3 times the current three-month average.

At $44.84, Deutsche (NYSE:DB) has slipped 3.3%. So far today, the company's volume is 916,709 shares. This is on pace to reach yesterday's trading volume of 2.2 million shares.

Prudential (NYSE:PRU) is currently trading at a share price of $57.93, a 3.3% decline. At 3.2 million shares, the company's volume so far today is 0.8 times the average daily volume.

Rising 2.9%, Associated (Nasdaq:ASBC) is currently trading at $12.93 per share. So far today, 2.3 million shares have changed hands.

Increasing 2.7%, Home Loan Servicing (Nasdaq:HLSS) is trading at $19.10 per share. So far today, the company's volume is 567,999 shares, 0.7 times the average volume over the last three months.

Currently trading at $130.84 per share, Westpac Banking Corporation (NYSE:WBK) has fallen 2.7%. So far today, 10,565 shares of the company's stock have changed hands. At this rate, trading activity will likely be down from yesterday when 37,404 shares changed hands.

The Bottom Line The nature of the market is such that stocks will have good days and bad days. Daily stock performance should be weighed against historical performance and put in context of the market overall. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.