Shares fell in the early trading session on Friday, while shares of JPMorgan (JPM) rose as much as 6% after a strong earnings report to kick off a crucial earnings period.
After about 40 minutes of trading on Friday, the S&P 500 (^GSPC) was down 0.3%. The Dow Jones Industrial Average (^DJI) was down 0.5%, and the Nasdaq Heavy Composite (^IXIC) was down about 0.5%.
JPMorgan (JPM) and Citi (C) saw stocks rally, while Wells Fargo (WFC) was little changed and PNC Financial’s (PNC) sock was under pressure after each bank reported results before opening Friday.
In early trading Friday, JPMorgan rose 6% while Citi rose 2.4% and Wells Fargo was little changed.
Economic data had moved markets early on Friday with A preliminary look at consumer confidence in April from the University of Michigan, indicating a rise in consumer inflation expectations, which investors took as a sign that the Federal Reserve will need to remain vigilant in keeping interest rates high.
The report showed that consumers’ expectations for higher prices over the next year rose to 4.6% from 3.6% last month. The stock lost modest gains after the headlines.
“These forecasts have been in swings for four straight months, alternating between increases and decreases,” said Joanne Hsu, director of consumer surveys. “Uncertainty about the short-term inflation outlook continues to rise significantly, indicating that the recent volatility in expected inflation for next year is likely to continue.”
Overall, the report showed that sentiment was “essentially unchanged” in April, with the index holding steady at 63.5, up from 62 at the end of March. The data came about an hour after Fed Chairman Chris Waller reiterated in a speech that inflation remains “very high.”
Elsewhere on the economic calendar, the monthly retail sales report showed sales fell 1% in March while industrial production data came in better than expected.
“Total, [retail sales were] Not as bad as we expected,” wrote Paul Ashworth, chief North America economist at Capital Economics. Thanks to a strong January, real consumption growth in the first quarter should approach 4.5%, with GDP growth at 1.8%, which could be enough to convince the Fed to raise a final 25 basis points in early May.”
Banks results shine
JPMorgan, the nation’s largest bank by assets, saw stocks jump 5% after reporting results above and below earnings that jumped from a year earlier.
Deposits, which investors will track closely this quarter after three US banks failed in March, rose 1.5% for the quarter at JPMorgan. Compared to the same period last year, deposits decreased by 7%.
In the company’s earnings release, CEO Jamie Dimon said, “The US economy remains in a healthy place overall — consumers are still spending and have strong balance sheets, and businesses are doing well. However, the storm clouds we’ve been watching last year still loom over us.” horizon, and the disruption of the banking industry increases these risks.”
Wells Fargo also reported top-and-bottom results that were up from a year earlier, with revenue of over $20.7 billion in the first quarter.
Consumer deposits fell 5% from a year earlier while commercial bank deposits fell 15% from the first quarter of 2022. Wells Fargo reported that loans to commercial customers were up 15% from the same period last year.
Wells Fargo CEO Charlie Scharf he said in a statementWe are pleased that we were in a strong position to help support the US financial system during the recent events affecting the banking industry.
Citi reported income and revenue that rose 7% and 12% from a year earlier, respectively, while highlighting that it had $1.3 trillion in deposits at the end of the quarter, “largely unchanged” from a year earlier, the company said in its report. launch. Chief Executive Jane Fraser said the company’s performance came “despite the turbulent environment for the banks”.
Elsewhere on the earnings side is BlackRock (BLK) Results shown Last year’s market turmoil weighed on investors as the company’s average assets under management fell to less than $9 trillion during the first quarter, down from $9.7 trillion in the same quarter last year. Revenue at the asset management giant also fell 10% from last year, to $4.24 billion.
“BlackRock is a source of both stability and optimism for customers,” CEO Larry Fink said in a statement. “We help clients navigate volatility and incorporate flexibility into their investment portfolios, while providing insights into the long-term opportunities that are obtainable in today’s markets.”
Elsewhere on the earnings calendar, shares of UnitedHealthcare (NH) were lower in early trade after the company reported results that beat estimates and raised its full-year 2023 outlook.
Meanwhile, shares of Boeing (BA) fell as much as 6% early Friday after the company announced it would halt deliveries of some 737 Max jets.
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