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JPMorgan Chase & Co, Citigroup Inc and Wells Fargo & Co will
unofficially kickoff the fourth-quarter earnings season before
the bell and investors will focus on their outlooks to validate
expectations for a strong 2021 rebound in earnings and the
economy.
Shares of the three banks slipped about 0.6% in premarket
trading.
Earnings for S&P 500 companies are expected to decline 9.5% in
the final quarter of 2020 from a year ago, but are expected to
rebound in 2021, with a gain of 16.4% projected for the first
quarter, according to IBES data from Refinitiv.
Biden's stimulus package proposal, unveiled on Thursday,
includes $415 billion to accelerate the distribution of
vaccines, some $1 trillion in direct relief to households, and
roughly $440 billion for small businesses and communities
particularly hard hit by the pandemic.
"There appears to be a some 'sell-the-news' price action in
equities, given that a lot of the optimism surrounding another
injection of US fiscal stimulus had already been priced in ahead
of the keenly awaited announcement," said Han Tan, Market
Analyst at FXTM.
Some investors worried that the government will need to fund the
spending through tax hikes eventually.
Wall Street's main indexes closed lower after the Dow and the
Nasdaq hit record highs during the session on bets of a hefty
package and vaccine distribution.
At 6:35 a.m. ET, Dow E-minis were down 135 points, or 0.44%, S&P
500 E-minis were down 17 points, or 0.44%. Nasdaq 100 E-minis
were down 40.75 points, or 0.32%.
Hewlett Packard Enterprise Co rose 1.2% after J.P. Morgan
upgraded the enterprise software maker's stock to "overweight"
from "neutral".
(Reporting by Devik Jain in Bengaluru; Editing by Maju Samuel)
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