Stocks drop as banks, energy names cap a losing week
J.P. Morgan, Citigroup and Wells Fargo kicked off earnings season
Stifel chief equity strategist Barry Bannister discusses his outlook for the markets and economy amid the coronavirus pandemic.
U.S. equities fell Friday morning after details of President-elect Joe Biden’s proposed $1.9 trillion COVID-19 relief package underwhelmed investors and as investors sold financials and energy stocks.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 44296.51 | +426.16 | +0.97% |
| SP500 | S&P 500 | 5969.34 | +20.63 | +0.35% |
| I:COMP | NASDAQ COMPOSITE INDEX | 19003.651134 | +31.23 | +0.16% |
The Dow Jones Industrial Average fell 177 points, or 0.57%, while the S&P 500 and the Nasdaq Composite were weaker by 0.72% and 0.87%, respectively.
Investors digested Biden’s proposed package, which includes a $1,400 check to individuals and provides a temporary boost in unemployment benefits while also providing funding for the distribution of COVID-19 vaccines, among other things. Major U.S. corporations could be looking at higher costs.
Financials lost ground after three of the major banks reported results, JPMorgan Chase & Co. reported quarterly profit rose 42% year over year, bolstered by investment banking and trading, which offset the headwind of low-interest rates.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| XLF | FINANCIAL SELECT SECTOR SPDR ETF | 50.73 | +0.56 | +1.12% |
| JPM | JPMORGAN CHASE & CO. | 248.55 | +3.79 | +1.55% |
| WFC | WELLS FARGO & CO. | 75.96 | +1.13 | +1.51% |
Wells Fargo & Co. posted a surprise profit but missed on revenue. The San Francisco-based lender's board of directors approved a 500 million-share increase to its buyback program. Citigroup Inc. also beat on the top line but fell short on revenue.
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Energy stocks are slipped as oil fell back to the $52 per barrel level.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| XLE | ENERGY SELECT SECTOR SPDR ETF | 97.26 | +0.12 | +0.13% |
In retail news stocks, Walmart in focus after announcing the head of its e-commerce unit Marc Lore will be stepping down at the end of the month. Lore, who founded Jet.com before joining the retailer, has been the point person in developing strategies to compete against Amazon.
WALMART'S E-COMMERCE CHIEF IS LEAVING
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WMT | WALMART INC. | 90.44 | +2.05 | +2.32% |
| AMZN | AMAZON.COM INC. | 197.12 | -1.26 | -0.64% |
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BB | BLACKBERRY LTD. | 2.35 | +0.03 | +1.29% |
Elsewhere, security software provider BlackBerry Ltd. shares were sharply higher for a second straight session after Canada’s The Globe & Mail reported the company sold 90 patents to Chinese tech giant Huawei.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| POSH | NO DATA AVAILABLE | - | - | - |
| WOOF | PETCO HEALTH AND WELLNESS | 4.17 | 0.00 | 0.00% |
Shares of online resale marketplace Poshmark Inc. remained in focus a day after soaring 142% in their New York Stock Exchange debut as did Petco.
Economic data was mixed as retail sales fell 0.7% month over month in December, missing the flat reading that was expected, and industrial production outpaced estimates with 1.6% month-over-month growth.
Looking at commodities, West Texas Intermediate crude oil slid $1.21 to $52.36 per barrel and gold shed $21 to $1,829.30 an ounce.
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European markets were lower across the board with Germany’s DAX 30 declining 1.44%, France’s CAC 40 falling 1.22%, and Britain’s FTSE 100 losing 0.97%.
In Asia, Japan’s Nikkei 225 declined 0.62% while China’s Shanghai Composite index ticked up 0.01% and Hong Kong’s Hang Seng index advanced 0.27%.