Fundamental analysis
17 January, 2022
Major bank stocks declined after their earnings reports on Friday, weighing on the U.S. markets as Wall Street notched a second straight negative week to start the year. Bank stocks, which had outperformed in recent weeks as interest rates moved higher, were broadly lower as their reports appeared to underwhelm investors despite strong headline numbers. JPMorgan Chase, the No. 1 U.S. bank by assets, showed profit and revenue that topped estimates, but shares fell more than 6%. The company’s earnings were helped by a large credit reserve release, and CFO Jeremy Barnum warned that the company would likely miss a key profit target in the next two years. Citigroup’s stock fell nearly 1.3% after the bank beat revenue estimates but showed a 26% decline in profits. Shares of Morgan Stanley and Goldman Sachs, which report next week, also declined. Shares of Netflix jumped more than 1% after announcing a price increase for U.S. and Canadian subscribers, helping the Nasdaq outperform on Friday. On the data front, retail sales were down 1.9% in December, a worse reading than the 0.1% drop expected by economists surveyed by Dow Jones.
