4:05pm: Stocks in negative territory
All three major US indices were in the red at the close, with the Dow leading the way at a 143 point loss to finish at 33,887 points for a 0.4% loss on the day.
Elsewhere, the S&P 500 finished 0.2% lower at 4,138 points and the Nasdaq closed 43 points lower at 12,123 for a decline of 0.4%.
12.05pm: March retail sales fall 1% month over month
US stocks were lower in noon trading as retail sales slipped 1% in March, more than the 0.5% decline expected by economists.
At midday, the Dow lost 190 points to 33,840, while the S&P 500 eased 17 points at 4,129 and the tech-heavy Nasdaq slipped 84 points to 12,082.
“Retail sales came in weaker than expected, but a lot of the miss had to do with lower gas prices, which all things being equal is a slight positive for spending,” Independent Advisor Alliance chief investment officer Chris Zaccarelli said.
Notable movers included shares of JPMorgan Chase & Co, which climbed 7% after the financial services giant posted record first-quarter revenue that surpassed analyst expectations.
10:45am: Regional bank earnings positive, but shares fall
PNC Financial Services Group, the closely watched US regional bank, reported first-quarter earnings which beat Wall Street estimates on revenue which jumped 59.9% on a year-over-year basis helped by higher deposits and interest rates.
For the period ended March 31, 2023, the Pittsburg-based bank reported earnings of 1.7 billion, or $3.98 per diluted share on revenue of $7.7 billion. The consensus earnings estimate was $3.60 per diluted share on revenue of $5.6 billion.
Despite moving higher in premarket trade, PNC shares were down over 2% by midmorning.
10:00am: Stocks turn around
As the trading day got started, markets started to react more positively to the bank earnings, with the S&P 500 and Nasdaq gaining 0.3%.
The Dow was an outlier, down 0.1% by 10am.
9:40am: Big bank earnings reassure investors
US stocks were mixed at the open as a slew of big banks rallied on better-than-expected quarterly results.
Shares of JPMorgan, Citigroup and BlackRock had added 6.2%, 3% and 1.6% respectively just after the market opened.
Tech stocks, however, struggled with the Nasdaq down 0.4% or 50 points at 12,116 points, while the S&P 500 was down 0.1% or 3 points at 4,143 points and the Dow Jones was flat at 34,037 points.
FOREX.com market analyst Fiona Cincotta said this quarter’s bank earnings were under the spotlight more than usual given the recent turmoil in the sector.
“While the fallout was contained quickly and fears of a more serious financial crisis had eased, the market is looking to these earnings for any further clues of cracks in the sector,” she said.
“Stronger-than-expected results from Citigroup and Wells Fargo, plus JP Morgan crushing estimates, have helped ease those concerns.”
Meanwhile, US retail sales fell more than expected in March, down 1% month-over-month, continuing the trend of softening US data seen this week.
“Excluding autos, gas and the control group, the numbers were stronger than expected, which may cloud the market reaction and potential positioning squaring into the weekend by market participants,” commented Validus Risk Management head of global capital markets Ryan Brandham.
8:45am: Bank earnings roll in
Investors are getting a glimpse at how the big banks performed in the first quarter and, spoiler alert, they've done well.
JPMorgan, Wells Fargo and Citigroup have all handily beat 1Q estimates, with JPMorgan in particular delivering record revenue during the quarter.
Futures for the main US indices are holding steady ahead of the open.
6:30am: Citi, Wells Fargo, JPMorgan due to report
Wall Street is likely to give back some of Thursday’s strong gains when the market opens on Friday as investors anticipate the first quarterly earnings from some of the largest US financial institutions since the failure of Silicon Valley Bank and Signature Bank in early March, while the latest retail sales numbers will give further insight into the health of the US consumer.
Futures for the Dow Jones Industrial Average (DJIA) declined 0.2% in pre-market trading, while those for the broader S&P 500 index fell 0.3%, and contracts for the Nasdaq-100 shed 0.4%.
The US benchmarks rallied on Thursday after the Producer Price Index (PPI) for March came in lower than expected, boosting hopes that the US Federal Reserve could put a pause on rate hikes next month. That followed Wednesday’s Consumer Price Index (CPI) release which revealed sticky core inflation. The Nasdaq Composite jumped 2% to 12,166, while the DJIA gained 1.1% to 34,030 and the S&P 500 added 1.3% at 4,146.
“Another big fall in US inflation, this time in headline PPI for March as well as core prices is fuelling optimism that we could start to see a similar effect filter down into the CPI numbers in the coming months, thus bringing us closer to possible rate cuts later this year,” commented Michael Hewson, chief market analyst at CMC Markets UK.
He added: “This may well be true, however with the US labour market still holding up reasonably well it’s hard to imagine the Federal Reserve will be in any rush to cut rates while the US economy continues to hold up reasonably well on the jobs front.”
March’s retail sales number also will indicate how consumer sentiment has fared in the wake of the recent banking turmoil, Hewson noted.
“After a strong start to the year US retail sales stalled in February slipping -0.4%, in the aftermath of the 3.2% surge seen in January. Personal spending also saw a similar slowdown in the same months, slowing from 2% in January to 0.2% in February.
“With all the concerns over bank runs in the US during March and consumers shifting their funds from smaller US banks to the biggest ones, consumer confidence managed to hold up pretty well. That doesn’t necessarily mean that we’ll see a similar pickup in retail sales. Expectations are for another weak reading of -0.4%," he said
“The bigger test, however, will be in how the US banks fared in Q1 and more importantly, how lending to US businesses and consumers held up during what was a turbulent quarter for the sector,” Hewson concluded.
JPMorgan’s earnings are seen as a bellwether for the broader financial sector and on the back of recent banking stress in the US, today’s results will be closely watched, commented TickMill Group market analyst James Harte.
“In terms of headline figures, Wall Street is looking for EPS of $3.41 on revenues of $36.125 billion. This would mark a slight uptick in revenues, though a mild drop in earnings,” Harte said.