The world’s largest banks reported earnings over the past week.
JPMorgan’s Jamie Dimon warned of looming “storm clouds” ahead for the US economy.
“I consider the current [bank] issues as not remotely comparable to 2008,” Morgan Stanley’s James Gorman said.
The world’s largest banks reported earnings over the past week, and all eyes were on CEOs of the Wall Street giants for cues on how markets will weather current economic conditions.
Several see a downturn, albeit a mild one, as consumers overall remain in strong shape and face the prospect of inflation continuing to cool.
Here is what some top bank CEOs are saying about the US economy during their earnings calls this season.
1. JPMorgan CEO Jamie Dimon
The Wall Street vet warned investors of looming “storm clouds” ahead.
“The US economy continues to be on generally healthy footings. Consumers are still spending and have strong balance sheets, and businesses are in good shape,” Dimon said. “However, the storm clouds that we have been monitoring for the past year remain on the horizon, and the banking industry turmoil adds to these risks.”
2. Bank of America CEO Brian Moynihan
During an earnings call, Moynihan warned of a US recession but said inflation has showed signs of cooling.
“Everything points to a relatively mild recession given the amount of stimulus that was paid to people and the money they have left over,” he said. “At the end of the day, we don’t see the activity on a consumer side slowing at a pace that would indicate that, but we see commercial customers are being more careful.”
He added: “The fact that unemployment is still 3.5% [shows] full employment-plus. And then the wage growth is slowing and tipping over, so the signs of inflation are tipping down. And it’s still there but that translates into relatively good activity. So we see a slight recession.”
3. Citigroup CEO Jane Fraser
She also predicted the country is bound to slip into a mild recession in 2023, but the slew of bank failures have amplified these concerns.
“We are in a strong position to navigate whatever environment we face, which is particularly relevant given the degree of uncertainty today,” Fraser said on an investor call this week. “We expect the recent events to be disinflationary and credit to contract.”
She added: “We believe it is now more likely that the US will enter into a shallow recession later this year.”
4. Morgan Stanley CEO James Gorman
Gorman told analysts that the US economy is in much better shape than during the Great Financial Crisis. He allayed fears of a full-blown banking crisis, addressing the turmoil sparked by collapse of specialist banks like SVB last month.
“We have had, and may still have, a crisis among some banks. I believe strong regulatory intervention, on both sides of the Atlantic, led to the cauterization of the damage,” Gorman said. “I consider the current issues as not remotely comparable to 2008.”
5. State Street CEO Ron O’Hanley
In an earnings statement, O’Hanley noted how macro conditions have shifted the bank’s performance over the past quarter, remarking on the efforts institutions have made in order to “stabilize the US banking system.”
“Our first-quarter results reflect the resiliency of our business model, not withstanding continued interest rate increases and subsequent significant market movements, volatility and disruption within other parts of the banking industry,” he told investors.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
