* JPM falls due to Q4 trading slowdown
* Wells Fargo increases after higher profits
* Macau caps six new casino licenses, but Casino stocks up
* Futures down: Dow 0.633%, S&P 0.677%, Nasdaq 0.85%. (Adds comments and updates prices throughout).
JPMorgan Chase & Co fell 3.9% in premarket trades after reporting weaker performance at the trading arm. However, it beat earnings expectations for its fourth quarter.
Wells Fargo & Co, on the other hand, gained 1.1% after posting a greater-than-expected rise in fourth-quarter profit.
Citigroup Inc declined 4.0% after posting a 26% decrease in fourth-quarter profits, but analysts still expected the bank to exceed expectations.
After posting fourth-quarter revenues below market expectations, asset manager BlackRock Inc fell 1.4%
“The sentiment is quite sour, even if today officially kicks-off the fourth quarter earnings reporting period…it seems as though inflation continues to override worry,” stated Sam Stovall chief investment strategist at CFRA Research in New York.
According to Refinitiv’s IBES data, the fourth quarter earnings growth was lower than the previous three quarters. However, it was still strong at 22.4%.
With expectations that banks will benefit from Federal Reserve interest rate increases and tightening Treasury yields, the S&P 500 financial sector has seen a nearly 6% increase since the beginning of the year.
The shift away from growth sectors like technology to more economically sensitive areas has also been beneficial for the financial sector.
Megacap growth companies like Apple Inc., Amazon.com Inc., Microsoft, Tesla, Meta and Meta plunged up to 3.3% per day following a selloff that was triggered by Fed speakers who emphasized inflation and interest rate increases.
Stovall stated that while the tech fundamentals remain positive, Stovall expressed concern about the sentiment and the possibility of additional weakness.
8.35 AM ET ET: Dow eminis fell 226 points or 0.63% at 8:35 a.m. S&P 500 was down 31.25 point or 0.67% and Nasdaq 100 dropped 131.25 percent or 0.85%.
After Macau’s government reduced the number of casino operators permitted to operate, Las Vegas Sands, MGM Resorts, Wynn Resorts, and Melco Resorts saw their numbers rise between 3.7% to 12%.
Retail sales fell in December due to shortages of goods in America and an increase in COVID-19 infection. However, this will not alter the expectation that economic growth would accelerate in the fourth quarter.
The Monday public holiday will cause the U.S. stock market to remain closed on Monday. (Reporting by Shreyashi Sanyal and Bansari Mayur Kamdar in Bengaluru; Editing: Maju Samuel
