LDN - Business

S&P, Dow futures rise after strong JPMorgan, Wells Fargo earnings

[July 14, 2023] By Johann M Cherian and Bansari Mayur Kamdar

(Reuters) - The S&P 500 and Dow futures rose on Friday as JPMorgan Chase and Wells Fargo commenced second-quarter earnings for big U.S. banks on a strong note.

JPMorgan Chase gained 2% in premarket trading after the largest U.S. lender posted a 67% jump in profit as it earned more in interest from borrowers, while Wells Fargo rose 3.6% after reporting a 57% rise in quarterly profit.

Citigroup, which is expected to report later in the day, rose 1.3%.

BlackRock slipped 0.7% after the world's largest asset manager posted a 1.4% decline in quarterly revenue, hit by impact of market movements over the past 12 months on average AUM.

UnitedHealth Group gained 3.6% after the health insurer reported a quarterly profit above analysts' estimates, as the industry bellwether's expenses came in lower than feared.

Overall earnings for the S&P 500 constituents are seen dropping 6.4% in the second quarter, according to Refinitiv data released at the start of the earnings season.

The earnings are expected to feed into a strong rally in recent days. U.S. stocks are on course for robust weekly gains, with the tech-heavy Nasdaq set for its best week since mid-March.

The Nasdaq and the S&P 500 ended the last two sessions at over one-year highs after data signaled easing price pressures in the U.S., adding to hopes that the Federal Reserve could wind up its rate hiking cycle soon after delivering a widely expected 25 basis point rate increase in July.

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Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., June 29, 2023. REUTERS/Brendan McDermid

Late on Thursday, Federal Reserve Governor Christopher Waller said he is not ready to call an all clear on inflation and supports two more 25 basis point rate hikes this year.

Investors will also look ahead to a preliminary University of Michigan survey that is expected to show consumer sentiment improved in July.

At 06:52 a.m. ET, Dow e-minis were up 114 points, or 0.33%, S&P 500 e-minis were up 1 points, or 0.02%, and Nasdaq 100 e-minis were down 19.5 points, or 0.12%.

Among other performers, Microsoft gained 1.3% after brokerage UBS turned bullish on the tech giant, with a "buy" rating.

Activision Blizzard added 2.3% as the gaming firm along with Microsoft are considering giving up some control of their cloud-gaming business in the UK to appease regulators, according to a report.

AT&T shed 1.8% after J.P. Morgan downgraded its rating on the telecom firm to "neutral".

(Reporting by Johann M Cherian and nd Bansari Mayur Kamdar in Bengaluru in Bengaluru; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila)

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