Here are the most important news, trends and analysis investors need to start their trading day:
1. Stocks Should Fall As Dow JPMorgan Stock Dips After Quarterly Results
Traders on the floor of the New York Stock Exchange, January 13, 2022.
U.S. equity futures accelerated lower on Friday after Dow JPMorgan stock fell 4% pre-market as investors analyzed the nation’s largest bank’s quarterly results by asset. The company’s fourth-quarter earnings per share of $ 3.33 and revenue of $ 30.35 billion, both beat estimates. However, JPMorgan said it took a net profit of $ 1.8 billion from the release of loan loss reserves that never materialized; without this benefit, earnings would have been $ 2.86 per share, which was not the case.
This week’s rebound in tech stocks was wiped out on Thursday, knocking the Nasdaq down 2.5% and the S&P 500 down 1.4%. The Dow Jones Industrial Average, which doesn’t have as much tech exposure, fell 0.5%. All three references shattered multi-day winning streaks. The Nasdaq ended Thursday down nearly 8.7% from its all-time high in November, approaching correction territory. The S&P 500 and Dow ended at 3.3% and nearly 2.3% respectively, far from their all-time highs last week.
2. Wells Fargo Stocks Stagnate, Citigroup Falls After Quarterly Results
In addition to JPMorgan, other banking profits continued to rise, with Wells Fargo posting better than expected fourth quarter revenue on Friday of nearly $ 20.86 billion. The shares were relatively stable in the pre-market. The results were aided by a reserve release of $ 875 million that the bank had built up during the Covid pandemic to protect against possible widespread loan losses. Wells Fargo also saw 5% growth in lending to its consumer and commercial portfolios in the second half of 2021.
Citigroup shares fell more than 3.7% on Friday after the banking giant reported a sharp drop in fourth quarter profits. The company’s net profit fell 26% to $ 3.2 billion. Citigroup cited an increase in spending for the sharp drop.
3. December retail sales drop much more than expected
The government said December retail sales fell 1.9% overall and excluding autos, 2.3%, both well below estimates for a 0.1% drop and an increase. by 0.3%, respectively. The sharp declines came amid a backdrop where shoppers spaced their holiday shopping earlier this year due to supply chain issues as inflation soared. This week, December’s consumer price index rose 7% year-on-year, matching the estimates and the fastest pace since June 1982, and last month’s producer price index rose by 9.7% year on year, slightly lower than estimated, but still the biggest increase on record.
4. Biden appoints Sarah Bloom Raskin as vice chairman of Fed oversight
President Joe Biden will appoint Sarah Bloom Raskin as the next Federal Reserve Vice Chairman for Oversight, arguably the most powerful banking regulator in the country, according to people familiar with the matter. She will face a confirmation hearing before the Senate Banking Committee, which this week heard from Fed Chairman Jerome Powell, appointed for a second term, and Fed Governor Lael Brainard, appointed vice chairman. Biden’s choices for Fed leadership positions come as central bankers are expected to raise interest rates several times this year after the cut ends. There is also talk of how to start reducing the Fed’s balance sheet.
5. Supreme Court blocks Biden vaccine mandate for business
The Supreme Court has barred the Biden administration from enforcing its strict vaccine or Covid testing requirements for large private companies. However, the High Court has authorized an immunization warrant for medical facilities that accept Medicare or Medicaid payments. Disappointed with the business decision, the president called on states and businesses to voluntarily institute firing requirements to protect workers, customers and the community at large. Regarding the healthcare workers’ part of the decision, Biden said it would save the lives of patients, doctors and nurses.
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