Wells Fargo shares close higher on Friday, 638 employees in mortgage business being dismissed

According to a report by Reuters, citing an emailed statement by Wells Fargo spokesperson Tom Goyda, over 600 employees are being laid off amid a slowdown in the banks mortgage business.

Wells Fargo shares closed higher for the fifth time in the past seven trading sessions in New York on Friday. The stock edged up 0.12% ($0.07) to $58.69, with the intraday high and the intraday low being at $58.92 and $58.67 respectively.

Shares of Wells Fargo & Company have retreated 3.26% so far in 2018 compared with a 7.52% gain for the underlying index, S&P 500 (SPX).

In 2017, Wells Fargo’s stock surged 10.09%, thus, it again underperformed the S&P 500, which registered a 19.42% return.

According to Goyda, 60 days notice have been given to 638 employees across the United States engaged in Wells Fargos home lending business. The cuts, which affect mostly retail fulfillment and servicing jobs, are concentrated in Ranch Cordova (California), Orlando (Florida), Charlotte (North Carolina) and Colorado Springs (Colorado).

Wells Fargos mortgage business has been struggling, since higher interest rates curb refinancing demand. According to Reuters, the banks income from mortgage banking operations shrank 33% year-on-year during the second quarter.

In order to boost earnings, the Wall Street bank has pledged to reduce costs by as much as $4 billion by the year 2020, while it continues to operate under an asset cap imposed by the Federal Reserve Bank in February.

According to CNN Money, the 28 analysts, offering 12-month forecasts regarding Wells Fargo’s stock price, have a median target of $63.00 with a high estimate of $70.00 and a low estimate of $50.00. The median estimate represents a 7.34% upside compared to the closing price of $58.69 on August 24th.

The same media also reported that 14 out of 32 surveyed investment analysts had rated Wells Fargo’s stock as “Buy”, while 11 – as “Hold”. On the other hand, 4 analysts had recommended selling the stock.

Daily and Weekly Pivot Levels

With the help of the Camarilla calculation method, todays levels of importance for the Wells Fargo stock are presented as follows:

R1 – $58.71
R2 – $58.74
R3 (Range Resistance – Sell) – $58.76
R4 (Long Breakout) – $58.83
R5 (Breakout Target 1) – $58.91
R6 (Breakout Target 2) – $58.94

S1 – $58.67
S2 – $58.64
S3 (Range Support – Buy) – $58.62
S4 (Short Breakout) – $58.55
S5 (Breakout Target 1) – $58.47
S6 (Breakout Target 2) – $58.44

By using the traditional method of calculation, the weekly levels of importance for Wells Fargo & Company (WFC) are presented as follows:

Central Pivot Point – $58.93
R1 – $59.28
R2 – $59.88
R3 – $60.23
R4 – $60.59

S1 – $58.33
S2 – $57.98
S3 – $57.38
S4 – $56.79