Here are the most important news, trends and analysis that investors need to start their trading day:
1. Stocks could fall as Dow JPMorgan shares fall after quarterly results
Traders on the floor of the New York Stock Exchange, January 13, 2022
Source: New York Stock Exchange.
U.S. stock futures fell sharply on Friday after Dow shares in JPMorgan fell 4% in premarket trading as investors analyzed the country’s largest bank by assets in quarterly results. The company’s fourth-quarter earnings per share of $3.33 and revenue of $30.35 billion beat estimates. However, JPMorgan said it made a net gain of $1.8 billion from the release of loan loss provisions that never materialized; without this benefit, earnings would have been $2.86 per share, which was not in line with expectations.
This week’s bounce in tech stocks was flattened on Thursday, sending the Nasdaq down 2.5% and the S&P 500 down 1.4%. The Dow Jones Industrial Average, which is not as heavily dependent on technology, fell 0.5%. All three benchmarks broke multi-day winning streaks. The Nasdaq closed on Thursday almost 8.7% below its all-time high in November, approaching correction territory. The S&P 500 and Dow lost 3.3% and almost 2.3%, respectively, from their all-time highs last week.
2. Wells Fargo shares flat, Citigroup shares fall after quarterly results
In addition to JPMorgan, other bank earnings continued to come in. On Friday, Wells Fargo reported higher-than-expected fourth-quarter revenue of nearly $20.86 billion. Shares were relatively flat in premarket. The results were helped by the release of $875 million in provisions that the bank set aside during the Covid pandemic to protect against possible wide-ranging loan losses. In the second half of 2021, Wells Fargo also saw a 5% growth in loans across its consumer and commercial portfolios.
Citigroup shares fell more than 3.7% on Friday after the banking giant reported a sharp fall in fourth-quarter earnings. The company’s net income fell 26% to $3.2 billion. Citigroup cited the increase in spending for a sharp decline.
3. December retail sales fell much more than expected
The Government stated Retail sales fell 1.9% overall in December and excluding autos fell 2.3%, well below estimates of a 0.1% decline and 0.3% growth, respectively. The significant drop comes as shoppers backed away from holiday shopping earlier this year due to supply chain issues due to soaring inflation. This week, the consumer price index rose 7% year on year in December, matching estimates and the fastest pace since June 1982, while the producer price index rose 9.7% year on year last month, slightly below estimates. but still the largest increase on record.
4. Biden will nominate Sarah Bloom Raskin for Fed Vice Chair for Supervision.
President Joe Biden to nominate Sarah Bloom Raskin for Fed chair the vice chairman for oversight is arguably the country’s most powerful banking regulator, according to people familiar with the matter. She faces confirmation hearings before the Senate Banking Committee, which this week saw Fed Chairman Jerome Powell nominated for a second term and Fed Governor Lael Brainard nominated for vice chairman. Biden’s choice to lead the Fed comes as central banks are expected to raise interest rates multiple times this year once the cuts are complete. There is also talk of how to start cutting the Fed’s balance sheet.
5. Supreme Court blocks Biden’s mandate to vaccinate businesses
Supreme Court is blocking the Biden administration from enforcing its broad Covid vaccine or test requirements for large private companies. However, the Supreme Court has allowed a vaccination mandate to be issued to healthcare facilities that accept Medicare or Medicaid payments. Frustrated by the business ruling, the president urged states and companies to voluntarily introduce gunshot requirements to protect workers, customers and the wider community. Biden said the healthcare workers part of the ordinance would save the lives of patients, doctors and nurses.
– Keep track of all market activity like a pro on CNNBC Pro. Get the latest news about the pandemic with CNBC Coronavirus Coverage.