WRAPUP 4-US credit card defaults fall, delinquencies up

* Defaults down at AmEx, BofA, JPMorgan, Citi, Capital One

* Delinquencies rise at big issuers, AmEx is the exception

* AmEx stock touches 16-month high, Discover up 4.6 pct (Adds Citigroup data, AmEx CFO comment; updates stock prices)

By Juan Lagorio

NEW YORK, Nov 16 (Reuters) - U.S. credit card companies said on Monday that defaults fell more than expected in October, but delinquencies mostly rose in a sign consumers remain under stress and the sector can expect more pain ahead.

The drop in defaults reflected a decline in late payments earlier this year thanks to tax refunds and economic stimulus actions.

Shares of American Express (AXP.N), the largest U.S. credit card company by purchases, rose to their highest level in 16 months, while Discover Financial Services (DFS.N) ended 4.6 percent higher.

But delinquencies, late payments that can indicate future credit losses, generally rose as more Americans lost their jobs. Capital One Financial Corp (COF.N) and JPMorgan Chase & Co (JPM.N) reported the biggest increases in late payments.

American Express Chief Financial Officer Dan Henry said unemployment was still a big uncertainty and was forecast to continue to rise.

"And so we have to take a cautious outlook, even though things are notably better than they were a year ago at this time and certainly better than they were early this year," Henry told the Reuters Global Finance Summit in New York.

Credit card charge-offs and delinquencies usually track unemployment, which rose to a 26-1/2-year high of 10.2 percent in October.

American Express Co said in a regulatory filing that its charge-off rate -- loans the company does not expect to be repaid -- fell to 7.8 percent in October from 8.4 percent in September.

Bank of America Corp (BAC.N), the largest U.S. bank, said that its charge-off rate fell to 13.22 percent in October from 14.25 percent in September. However, the bank is still the credit card issuer with higher defaults and delinquencies.

JPMorgan, the largest issuer of Visa-branded credit cards, said its charge-off rate declined to 8.02 percent from 8.12 percent, while Citigroup Inc (C.N), the biggest issuer of MasterCard-branded credit cards, said defaults fell to 8.79 percent from 10.15 percent.

Capital One's charge-off rate fell to 9.04 percent from 9.77 percent, and Discover' declined to 8.54 percent from 8.69 percent.

"It's of course nice to see the decline in chargeoffs, but our view remains that the delinquency trends that we have seen in the past few months suggest that there is more credit pressure ahead," RBC Capital Markets analyst Jason Arnold said.