4.05pm: Tech stocks lead a broad-based market rally
US stocks finished the trading session sharply higher as earnings season kicked off with some better-than-expected results.
At the close, the Dow gained 344 points to 34,565, while the S&P 500 added 49 points at 4,447 and the tech-heavy Nasdaq climbed 272 points to 13,644.
Notable movers included shares of JPMorgan Chase & Co (NYSE:JPM), which slipped more than after 3% after the bank saw its first-quarter profit drop 42% following a $524 million charge for market dislocations due to sanctions against Russia.
12:00pm: Stocks in the green despite mixed earnings
The S&P 500, Dow and Nasdaq were all in the green at the midday point Wednesday in a positive sign that a three-day losing streak could be coming to an end.
First-quarter earnings season began with results from JPMorgan Chase, Delta Air Lines (NYSE:DAL), BlackRock Inc (NYSE:BLK). BLK, -0.37%, and others.
At noon, the Dow was up 0.5%, at 34,396 points, while the S&P 500 rose 0.7%, at 4,429 and the Nasdaq jumped 1.6%, to 13,583.
Chris Beauchamp, chief market analyst at online trading platform IG, called Wednesday "another cautious day" as markets edge higher despite JPMorgan’s gloomy earnings.
“Earnings season has begun in earnest, but it has not been a particularly positive start," Beauchamp said.
"JPMorgan’s numbers revealed that dealmaking was down and credit losses had increased, as the bright outlooks of 2021 give way to the gloomier performance of 2022. There wasn’t much good news in the outlook for the year ahead either; the usual bugbears of inflation, central bank policy and the Ukraine war combined to produce a very cautious forecast for the months to come, something that may well be echoed by other banks tomorrow."
11.10am: Proactive North America headlines:
Xigem says Cylix Data Corporation provides an innovative resource for fraud mitigation
SPYR (OTCQB:SPYR) Technologies says Applied Magix subsidiary considers entering MVNO business
Western Magnesium hires independent valuation firm to assess company, its intellectual property (IP), systems and market potential
VanadiumCorp Resources announces completion of share consolidation
American Battery Technology hires former Tesla member Mark McDaniel as senior staff analytical chemist
Zoglo's Incredible Food says six of its products nominated as finalists for national food awards
Pathfinder closes on property deal to expand its RV resort in Agassiz, British Columbia
Gevo hails President Biden's executive actions supporting sustainable aviation fuel
Globex Mining Enterprises says Labyrinth Resources is seeing positive results from initial drilling at the Labyrinth project in Quebec
Railtown AI Technologies broadens offering with launch of Root Cause Discovery for Javascript
Kootenay Silver says Cervantes drilling campaign has revealed broad gold mineralization at the California target
CleanSpark among Top 50 fastest-growing companies, according to the FT
Electric Royalties updates on 1Q activities from operating partners across its battery metals portfolio
Vicinity Motor secures US Midwest distribution deal with Hoekstra Transportation, including an initial order for eight vehicles
Silverton Metals hits high-grade silver at its Peñasco Quemado project in Mexico
i-80 Gold closes US$135M gold prepay and silver purchase and sale package with Orion Mine Finance
Real Luck Group announces partnership with Microgaming at ICE 2022 to enhance Luckbox online casino
Star Royalties looking to continue momentum into 2022 as it posts full year financial results
SoLVBL Solutions enters product design agreement with KRFTWRK Inc
Canntab Therapeutics appoints Hamish Sutherland as strategic business consultant
Lucky Minerals (TSX-V:LKY, OTC:LKMNF) says assay results for trench T-21 at Fortuna property shows 5.24 g/t gold across 14 metres
Hawkmoon receives all required drilling and trenching permits for Wilson gold project in Quebec
Braxia Scientific reaches agreements to settle class actions in US and Canada pending court approval
Cabral Gold reports more encouraging drill results from Brazil project, this time from Central deposit
Lifeist Wellness Inc's US subsidiary Mikra engages two Olympic medallists as brand ambassadors
Fidelity Minerals closes oversubscribed private placement for gross proceeds of C$992,500
CULT Food Science invests in leading cultivated meat company MeaTech 3D Ltd
10am: US stocks start higher
US benchmarks started marginally ahead on Wednesday after a volatile start as first quarter earnings season kicked off.
The Dow Jones Industrial Average added around 66 points to stand at 34,286. The S&P 500 added around nine points at 4,407. The tech laden Nasdaq index gained around 34 points to stand at 13,406.
Analysts have lowered expectations for corporate earnings amid the continuing coronavirus (Covid-19) pandemic, rising inflation and the war in Ukraine.
Earnings for S&P 500 companies are reportedly expected to increase by 4.5% in the three months to end-March - the lowest growth since the fourth quarter of 2020.
Big bank JPMorgan saw shares drop nearly 3% on the day as it unveiled a 42% slip in first-quarter profit, which it put down to increased costs for bad loans and market upheavals. The company did report, however, $31.59 billion in revenue for the period, which was slightly more than had been expected by analysts.
6.40am: Higher open predicted
US stocks are set for a rebound on Wednesday ahead of major earnings releases and as investors find some measure of comfort that inflation may be starting to peak.
JPMorgan Chase, Delta Air Lines (NYSE:DAL) and BlackRock are some of the biggest companies expected to release their earnings results. Investors will be paying particular attention to the guidance they will provide for their performance for the rest of the year.
Data released yesterday showed US consumer prices accelerated in March, with the index rising 8.5% from a year ago. But while it is the fastest increase since December 1981, economists say there are bright sparks in the report, indicating that inflation may begin to roll over in the next few months.
Futures for the Dow Jones Industrial Average rose 0.32% in pre-market trading, while those for the S&P 500 gained 0.35% and contracts for the tech-heavy Nasdaq-100 were 0.41% higher.
“Core inflation, which filters out the impact of volatile food and energy prices, came in at the lowest since September, giving some hope to investors that inflation may soon hit a high and start easing,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
She said this will take the pressure off the US Federal Reserve to move less hurriedly to raise its benchmark funds rates, widely expected at a series of 50 basis-point hikes in the coming few months.
While a rebound in Wednesday’s trading session is expected, Ozkardeskaya said high energy prices, the ongoing pandemic and the war in Ukraine will combine to keep the market’s outlook depressed.
“Expectations for bank earnings are soft this quarter. The net income for the six biggest American banks is expected to fall about 35% from a year ago, also including the major deceleration in activity in March due to the war in Ukraine and losses from exiting their operations in Russia,” she said, noting that JPMorgan CEO James Dimon had warned that the bank could lose about US$1 billion from its Russian exposure.
Elsewhere, oil prices rebounded on supply worries after Russian President Vladimir Putin said Moscow’s offensive in Ukraine will continue now that peace talks had reached a dead end. The benchmark Brent crude futures was at $106.25, up 1.5%.
Contact the author at stephen.gunnion@proactiveinvestors.com