Having Warren Buffett at your back usually bodes well, as big banks Bank of America Corp (NYSE:BAC) and Wells Fargo & Co (NYSE:WFC) well know. Ever since the Oracle noted that his company, Berkshire Hathaway Inc. (NYSE:BRK.A), has been buying up Wells Fargo stock, the bank’s shares have been moving pretty nicely upward, as I noted in my article of one week ago.
Other Fools, namely John Maxfield, have mentioned the Warren effect as well — particularly since the media trumpeted Buffett’s acquisitions yesterday after eyeballing his company’s 13-F filing.
Most banks sagged throughout the day
Yesterday, at least, Wells’ good news wasn’t enough to buoy financials for the entire day, and a generally upward trend in the big bank sector by midday was reversed as early gainers like B of A, JPMorgan Chase & Co. (NYSE:JPM) , and Citigroup Inc (NYSE:C) dropped a bit before the market closed. Even Wells dipped a little, though only by 0.1%.
Today is looking like another good day for Buffett’s favorite bank, and Wells is already up by about 0.4% at mid-morning. Indeed, the entire banking sector is lit up in bright green, as Citi, Bank of America Corp (NYSE:BAC), and JPMorgan Chase & Co. (NYSE:JPM) all clock some impressive gains early this Friday morning.
Will a bit of negativity hurt Wells later in the day?
While Wells is looking very bubbly so far today, a couple of pieces of news came out yesterday that might put a damper on these gains later in the day.
Wells has been told by a judge that it must ante up and refund consumers $203 million for its part in the debit-card transaction scandal, which it has been fighting tooth and nail. While other banks like B of A, Citi, and JPMorgan Chase & Co. (NYSE:JPM) have settled — and Bank of America Corp (NYSE:BAC) has even sent out some checks to customers affected by the practice — Wells says it plans to appeal this judge’s decision.
In another negative PR piece, an Orlando, Fla. man is claiming that Wells is improperly foreclosing on his home, despite his having made his mortgage payments timely. A representative of Wells Fargo & Co (NYSE:WFC) said that the bank is on task to help this customer, but these types of news blurbs are never a good thing for any bank’s image.
So far, however, there is no rain on Wells’ horizon, and the stock has gained over 0.90% by 10 a.m. ET. With the whole financial sector looking bouncy still, it looks like a happy Friday for Wells Fargo & Co (NYSE:WFC) and its peers.