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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 0.72%, S&P 0.62%, Nasdaq 0.90%
(Updates to afternoon, adds NEW YORK dateline, changes byline)
By Stephen Culp
NEW YORK, April 14 (Reuters) - Wall Street lost ground
on Friday as a barrage of soft economic data appeared to affirm
another interest rate hike from the Federal Reserve, dampening
investor enthusiasm after a series of big U.S. bank earnings
launched first-quarter reporting season.
All three major U.S. stock indexes were in the red, but
coming on the heels of Thursday's robust rally, the S&P 500 and the Dow remained on track for weekly gains.
"Yesterday we saw one of the strongest rallies heading into
earnings season in quite some time, so there was a really high
bar for stocks to continue that rally," said Ross Mayfield,
investment strategy analyst at Baird in Louisville, Kentucky.
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," Mayfield added. "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 3.4% and JPMorgan Chase surged 7.3%, setting itself up for its biggest one-day percentage gain since Nov. 9, 2020. Citigroup advanced 5.0% while Wells Fargo edged 0.1% higher. 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. 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 an 80% likelihood of that happening, according to CME's FedWatch tool. At 2:03 p.m. ET, the Dow Jones Industrial Average fell 245.05 points, or 0.72%, to 33,784.64; the S&P 500 lost 25.64 points, or 0.62%, at 4,120.58; and the Nasdaq Composite dropped 109.03 points, or 0.9%, to 12,057.24. Among the 11 major sectors of the S&P 500, financials were the sole gainers. First-quarter earnings season hits full stride next week, with reports expected from a number of 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. BlackRock Inc rose 2.8% after the world's largest asset manager beat quarterly profit expectations. Boeing Co slid 6.3% after the planemaker halted deliveries of some 737 MAXs due to a supplier quality problem attributed to Spirit AeroSystems .
Spirit AeroSystems' shares swooned, falling 20.5%.
Shares of Lucid Group Inc dropped 7.6% following
the luxury electric automaker's disappointing first-quarter
production and delivery numbers.
Declining issues outnumbered advancers on the NYSE by a
3.01-to-1 ratio; on Nasdaq, a 2.58-to-1 ratio favored decliners.
The S&P 500 posted nine new 52-week highs and two new lows;
the Nasdaq Composite recorded 37 new highs and 182 new lows.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
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)
