Eagle Eye Opener: Bank of America Leads U.S. Profit Performance; Japanese Economy Impresses Fund Managers

U.S. Profit Parade Still Going Strong (Reuters)

Bank of America Corp’s first quarter profits quadrupled as the banking behemoth cut expenses and earmarked less funds for bad loans. Net income came in at $2.62 billion (20 cents per share), up from $653 million (3 cents per share) a year earlier.  When comparing these year-to-year figures, please note that last year’s earnings also reflect almost $5 billion in charge offs for debt. That said, earnings did fall short of what analysts expected from the nation’s second-largest bank for the quarter. Bank of America had been expected to earn 23 cents per share. However, if you ask the bank’s investors, they probably don’t have a problem with that as share price has appreciated 40 percent over the last 12 months. And that goes a long way to countering missed estimates.

Japanese Economy Impresses 100% of Fund Managers Surveyed (CNBC)

Since taking office a couple of months ago, new Japanese Prime Minister Abe’s economic recovery plan seems to be working in spades. At least, that’s what 252 fund managers think, according to a recent Bank of America/Merrill Lynch fund manager survey. Every one of the managers surveyed expects Japan’s economy to continue strengthening during the next 12 months. And their opinions matter, as they represent some $725 billion in assets. Compare that optimism to what’s expected from China — given its most recent disappointing quarter of growth — and you have two countries going in opposite directions. It is not too hard to figure out what to do with investable funds at this point, is it?

‘The New Oil’ Launches $3 Billion Boom in Mexico (Bloomberg)

Since 2009, Mexico has doubled its automobile production. And now Mexico is benefitting from funds flowing into infrastructure to support that unprecedented growth at an unprecedented rate — $3 billion in U.S. dollars to be exact. Marco Oviedo, the chief economist for Barclays Plc. in Mexico, said “Auto exports are going to be the new oil for the Mexican economy.” The Mexican Automobile Industry Association added that it expects auto production to continue to increase in the next few years, as much as 40 percent more by 2017. And that’s just in time too, for a Mexican economy desperately in need of a boost.