Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Why Are These Stocks Deep in the Red Today?

Despite the unemployment rate falling to 4.7%, all three indexes are in the red this morning after the Labor Department reported that nonfarm payrolls increased 38,000 versus the 160,000 that many analysts were expecting. The Dow Jones index is down more than 100 points, the S&P is down 0.7% and the NASDAQ index is off almost 1%. Among the stocks that are lower than the index are E*TRADE Financial Corp (NASDAQ:ETFC), Bank of America Corp (NYSE:BAC), Immunomedics, Inc. (NASDAQ:IMMU), Gogo Inc (NASDAQ:GOGO), and Globalstar, Inc. (NYSEMKT:GSAT). Let’s find out why traders are selling and see what the smart money thinks of each stock.

flight, flying, travel, areal, airplane,

Andrew Barker/

At Insider Monkey, we track around 760 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).

Friday’s Weak Nonfarm Payroll Wrecks Havoc in the Financial Sector

E*TRADE Financial Corp (NASDAQ:ETFC) and Bank of America Corp (NYSE:BAC) are down by 5% and 3.4% respectively due to the weak non-farm payroll report. Because the payroll number came in significantly below expectations, investors now don’t know if the Federal Reserve will raise interest rates this month during its FOMC meeting. If the Federal Reserve remains accommodative and interest rates remain low, E*TRADE Financial Corp (NASDAQ:ETFC) and Bank of America Corp (NYSE:BAC) won’t make as much in interest related income and their earnings per share won’t be as strong as many bulls expected. In the intermediate to long term, however, many investors  believe the Federal Reserve will eventually raise rates and both stocks will benefit from wider net interest margins. Of the 766 elite funds in Insider Monkey’s database, 39 were long E*TRADE and 110 were bullish on Bank of America at the end of March.

Follow Bank Of America Corp (NYSE:BAC)
Trade (NYSE:BAC) Now!

Follow E Trade Financial Corp (NASDAQ:ETFC)
Trade (NASDAQ:ETFC) Now!

On the next page, we examine Immunomedics, Gogo, and Globalstar.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.