Citigroup Inc (C)

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1 Stock To Dump When Markets Open: Citigroup
By: Investing.com | April 3, 2022

Stock To Dump: Citigroup

Citigroup (NYSE:C) saw its shares close at their weakest level since November 2020 on Friday. C could break down to new lows in the coming week as investors monitor distressing moves in the U.S. Treasury market after a key part of the yield curve inverted.

Bank stocks have historically performed poorly during times of inverted yield curves as they typically profit by borrowing money in the short term and lending it in the long term. As such an inverted yield curve, which, as mentioned earlier, is usually viewed as a reliable recession indicator, is likely to pressure bank margins and profitability.

Investors are also bracing for a disappointing earnings report from the fourth biggest U.S. banking institution, due on Thursday, Apr. 14 ahead of the opening bell. Consensus calls for Q1 earnings of $1.66 per share, plunging 54% from EPS of $3.62 in the year-ago period amid a jump in operating expenses. Revenue expectations are equally concerning, with sales growth predicted to slip about 5% year-over-year to $18.4 billion due to a sharp slowdown in its consumer banking business.


C Daily Chart

C fell to a fresh 17-month low of $51.76 on Friday, before closing at $52.33, earning the New York City, New York-based megabank a market cap of $103.2 billion.

Citigroup shares have underperformed those of the other big banks this year, losing 13.3% in 2022. In comparison, the financial sector’s main ETF—Financial Select Sector SPDR® Fund (NYSE:XLF)—is down just 2.1% year-to-date. The S&P 500, for its part, is off by 4.6% over the same timeframe.

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