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Wall St set for lower open as some big bank earnings disappoint

Published 12/04/2024, 07:04 pm
Updated 12/04/2024, 10:58 pm
© Reuters. Traders work on the trading floor at the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2024. REUTERS/Andrew Kelly

By Shashwat Chauhan and Shristi Achar A

(Reuters) -Wall Street's main stock indexes were on track for a lower open on Friday as most megacap growth stocks and chipmakers receded, while some big banks dipped after dour quarterly results.

JPMorgan Chase & Co (NYSE:JPM) fell 2.8% in premarket trading after the bank's forecast for its income from interest payments came in below analysts' expectations.

Wells Fargo (NYSE:WFC) lost 0.3% after reporting a more than 7% fall in first-quarter profit, as it earned less from customer interest payments.

Citigroup gained 1.3% despite reporting a fall in first-quarter profit.

"Most indicators are that the growth has been fairly persistent in the last couple of quarters," said Hugh Anderson, managing director at HighTower Advisors.

"I would expect that the banks are going to show some decent earnings, but they also might show some cracks in the other parts of the reports, such as delinquencies, defaults and the like, because there is some evidence of that in the market."

Most megapcap growth stocks dipped, with Nvidia, Tesla (NASDAQ:TSLA) and Meta Platforms down between 0.3% and 0.9%.

Advanced Micro Devices (NASDAQ:AMD) and Intel (NASDAQ:INTC) lost about 2% each after a report that Chinese officials had told the country's largest telecom carriers earlier this year to phase out foreign chips that are key to their networks by 2027.

The Dow and the S&P 500 eyed weekly losses as sentiment was roiled this week following a hotter-than-anticipated inflation reading that pushed traders to scale back their enthusiasm around the U.S. Federal Reserve cutting interest rates. The tech-heavy Nasdaq, however, was on track for its first weekly gain in three.

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The Nasdaq and the S&P 500 closed higher in the previous session as fresh economic data rekindled hopes that inflation remained in a cooling trend.

Money market participants see an about 50% chance of the Fed bringing in the first interest-rate cut in July, according to the CME FedWatch Tool.

U.S. large-cap stocks suffered their largest weekly outflow since December 2022 in the week to Wednesday, Bank of America (NYSE:BAC) said.

Meanwhile, Boston Fed President Susan Collins is eyeing a couple of interest-rate cuts this year, amid expectations that it could take some time for inflation to return to its targeted level.

Focus now turns to comments from Kansas City Fed President Jeffrey Schmid, Atlanta Fed President Raphael Bostic and their San Francisco counterpart Mary Daly later in the day, for hints on the central bank's rate outlook.

On the data front, a preliminary reading of the University of Michigan's overall Consumer Sentiment Index for April is due at 10 a.m. ET.

At 8:30 a.m. ET, Dow e-minis were down 111 points, or 0.29%, S&P 500 e-minis were down 19.75 points, or 0.38%, and Nasdaq 100 e-minis were down 95 points, or 0.51%.

BlackRock (NYSE:BLK) rose 2.6% after the world's largest asset manager reported record assets under management and posted a 36% jump in profit.

State Street (NYSE:STT) gained 1.5% after the custodian bank's assets under management for the first quarter rose by nearly 20%.

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