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JPMorgan profit surges 52% on robust consumer business
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Wells Fargo, Citi profits climb on higher interest income
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BlackRock profit beats on robust inflows
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Indexes down: Dow 0.42%, S&P 0.21%, Nasdaq 0.35%
(Updates with closing prices)
By Stephen Culp
NEW YORK, April 14 (Reuters) - Wall Street ended lower
on Friday as a barrage of mixed economic data appeared to affirm
another Federal Reserve interest rate hike, dampening investor
enthusiasm after a series of big U.S. bank earnings launched
first-quarter reporting season.
All three major U.S. stock indexes ended in the red, but
well off session lows. On the heels of Thursday's robust rally,
all three major U.S. stock indexes notched weekly gains.
"Today we're taking bit of a breather," said Sal Bruno,
chief investment officer at IndexIQ in New York. "After
yesterday's sharp move up, the market might have gotten a little
ahead of itself."
Citigroup Inc , JPMorgan Chase & Co and Wells
Fargo & Co beat earnings expectations, benefiting from
rising interest rates and easing fears of stress in the banking
system.
"As expected, the bigger banks were probably not harmed that
much by the regional banking turmoil, and possibly even
beneficiaries of it," said Ross Mayfield, investment strategy
analyst at Baird in Louisville, Kentucky. "We saw mostly strong
and healthy balance sheets, and it's pretty clear (the regional
banking) crisis isn't systemic."
The S&P 500 banking sector jumped 3.5% and JPMorgan
Chase surged 7.6%, its biggest one-day percentage gain since
Nov. 9, 2020.
Citigroup advanced 4.8% while Wells Fargo edged 0.1% lower.
But a slew of mixed economic data including retail sales,
industrial production and consumer sentiment cemented
expectations that the Fed will hike rates another 25 basis
points at next month's policy meeting.
"Industrial production and capacity utilization came in
stronger than expected," Bruno added. "Both point to an economy
that still has some vibrancy, which gives Fed cover to continue
its rate hike policy in May possibly into June."
Those expectations were underscored by Atlanta Fed President
Raphael Bostic, who said another 25 basis point hike could allow
the Fed to end its tightening cycle, even as Chicago Fed
President Austan Goolsbee called for the central bank to be
prudent.
At last glance, financial markets have priced in a 74%
likelihood of that happening, according to CME's FedWatch tool.
The Dow Jones Industrial Average fell 143.22 points,
or 0.42%, to 33,886.47; the S&P 500 lost 8.58 points, or
0.21%, at 4,137.64; and the Nasdaq Composite dropped
42.81 points, or 0.35%, to 12,123.47.
Among the 11 major sectors of the S&P 500, seven ended the
session lower, with real estate falling most.
Financials enjoyed the biggest percentage jump,
advancing 1.1%.
First-quarter earnings season hits full stride next week,
with results expected from several high profile companies
including Goldman Sachs Group Inc , Morgan Stanley ,
Bank of America Corp , Netflix Inc and a long
list of regional banks and industrials.
Analysts have lowered expectations, forecasting aggregate
S&P 500 earnings having fallen by 4.8% from a year ago, a
reversal of the 1.4% year-on-year gain seen at the beginning of
the quarter, according to Refinitiv.
BlackRock Inc rose 3.1% after the world's largest
asset manager beat quarterly profit expectations.
Boeing Co slid 5.6% after the planemaker halted
deliveries of some 737 MAXs due to a supplier quality problem
attributed to Spirit AeroSystems , whose shares fell
20.7%.
Shares of Lucid Group Inc dropped 6.3% following
the luxury electric automaker's disappointing first-quarter
production and delivery numbers.
Declining issues outnumbered advancers on the NYSE by a
2.01-to-1 ratio; on Nasdaq, a 2.07-to-1 ratio favored decliners.
The S&P 500 posted 11 new 52-week highs and two new lows;
the Nasdaq Composite recorded 47 new highs and 205 new lows.
Volume on U.S. exchanges was 9.98 billion shares, compared
with the 11.31 billion average over the last 20 trading days.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Bank stocks lag S&P 500 this year Consensus grows for Fed rate hike in May Consensus grows for Fed
rate hike in May ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Stephen Culp; Additional reporting by Sruthi
Shankar, Ankika Biswas and Bansari Mayur Kamdar in Bengaluru and
Richard Chang)
