Stock Market Today: Technology Stocks Slip at the Top as Banks Start Their Earnings Season

Stocks stumbled on Friday as the tech industry lost its momentum and investors looked to major banks’ upcoming results for inspiration as earnings season kicked off.

The tech-heavy Nasdaq Composite () slipped 0.9%, while the S&P 500 () lost 0.7%. The Dow Jones Industrial Average () fell 0.6%, or more than 200 points.

Stock prices are falling after “Magnificent 7” technology stocks led a rise on Thursday, fueled by AI tailwinds. Investors also took comfort in a smaller-than-expected rise in wholesale inflation after being worried by higher-than-expected consumer prices.

BlackRock’s (BLK) results kicked off earnings season early Friday, with hopes that corporate updates can revive the stock rally earlier in the year. Shares of the world’s largest asset manager rose sharply in morning trading after the company posted a 36% jump in profits.

Investors are waiting for giant banks to show how they will benefit if interest rates remain higher than expected this year. JPMorgan (JPM) reported that profit rose as it earned more interest payments, while Wells Fargo (WFC) reported a decline in profit as interest income fell.

Meanwhile, precious metals continued to shine, with gold (GC=F) rising above $2,400 to hit another new record, and silver (SI=F) trading at its highest level since early 2021. Demand appears to be driven by investors seeking safety amid rising averages and tensions in the East, but avoiding US Treasuries due to inflation concerns.

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Fri, April 12, 2024 at 6:37am MST

Stock prices fall as banks start their earnings season

Stocks lost ground on Friday as technology stocks lost momentum and investors braced for the first wave of results of the earnings season as results from major banks arrived.

The tech-heavy Nasdaq Composite (^IXIC) fell 0.9%, while the S&P 500 (^GSPC) lost 0.7%. The Dow Jones Industrial Average (^DJI) fell 0.6%, or more than 200 points.
Fri, April 12, 2024 at 5:23am MST

Jamie Dimon makes a good case about interest rates to Yahoo Finance

Funny call just with reporters with JP Morgan (JPM) CEO Jamie Dimon and CFO Jeremy Barnum.

The topic was, of course, profits, but also Dimon’s views on interest rates and the economy.

Dimon made a good point to me about interest rates (I had asked Barnum how the company was preparing for higher, longer interest rates):

“I just want to point out that it is not so important that the interest rates are higher in themselves. What matters is the reason – is it due to stagflation, which is obviously negative, or is it due to healthy growth, which is actually pretty good.”

Dimon went on to say that he was not “predicting” a recession.
Fri, Apr 12, 2024 at 4:43am MST

Early Trend Outlook from Bank Results: Investment Banking

One division jumps right off the earnings reports from JP Morgan (JPM) and Wells Fargo (WFC) this morning.

Investment banking.

At JP Morgan, investment banking revenue rose 27% year over year, driven by higher debt and equity underwriting fees.

Wells Fargo’s investment banking revenue increased 69% year-over-year.

Signs of more mergers and acquisitions and IPOs coming this year? Let the debate begin.
Fri, Apr 12, 2024 at 3:14am MST

It’s hard to condemn these BlackRock earnings

One should always be hypercritical of an earnings report and announcement. Question everything, good and bad.

However, I’m having a hard time considering BlackRock’s (BLK) results this morning. In its most basic form, this is a giant asset manager that grew assets under management (AUM) by $1.4 trillion year-over-year to $10.5 trillion. At the same time, the company’s more vigilant view of costs led to a 180 basis point improvement in operating margins compared to the previous year.

Given the size of a BlackRock, it doesn’t get much better.

Shares are up nearly 2% premarket, and rightly so.
Fri, April 12, 2024 at 3:01am MST
In Apple retail

Apple’s (AAPL) ticker returned to Yahoo Finance’s Trending Ticker page for the weekend.

The stock rose on Thursday on a report that the company is refreshing its Mac lineup with new AI-enabled chips. Seems like good news that may only further embolden bulls to test the tech giant’s shares again after a 9% year-to-date decline.

Why the stock has lagged reflects several reasons, clearly laid out by JP Morgan analyst Samik Chatterjee in a new note to clients.

Chatterjee says the iPhone sales data “highlights headwinds,” including in China. There are also concerns about downside risk to Apple’s services business amid “tighter regulatory scrutiny in multiple regions.”

But these concerns are now largely embedded in the share price, Chatterjee claims.

He says investors are starting to get excited about Apple:

The stock’s valuation premium to the broader market has weakened – the stock’s valuation is now at the lower end of the metrics at which the shares have recently traded since the launch of the iPhone 12.

There is “increasing investor interest” in Apple as an “AI upgrade cycle” stock play.