U.S. stocks ended Friday higher after key earnings reports from financial heavyweights.
The S&P 500 (^GSPC) added 0.4%, while the Dow Jones Industrial Average (^DJI) increased by 0.3%. The technology-heavy Nasdaq Composite (^IXIC) was up roughly 0.7%, closing upward for sixth consecutive day, the longest streak since 2021. The Nasdaq and S&P 500 notched their biggest weekly gains in about two months.
The yield on the benchmark 10-year U.S. Treasury ticked up slightly to 3.5%. The dollar index showed little change.
Stocks pared early losses after the University of Michigan consumer sentiment survey for January rose to a nine-month high of 64.6 from 59.7 last month. The expectations index rose to 62.0 compared to 59.9 last month.
The news provided a more optimistic outlook after a downbeat tone from America’s biggest banks, who took center stage to kick off the fourth quarter’s earnings season. Their earnings showed continued resilience in the face of economic headwinds, though many said they were taking steps to prepare for a recession in the U.S.
JPMorgan (JPM) posted better-than-expected fourth-quarter earnings, as CEO Jamie Dimon said the the U.S. economy “remains strong.” However, the bank said its central case for this year is a mild recession. JPMorgan said earnings for the three months ending in December were pegged at $11.1 billion, or $3.57 per share, up 7.2% from the same period last year.
Bank of America (BAC) reported fourth-quarter earnings that showed the bank’s revenue benefited from higher interest rates. Bank of America reported revenue of $24.5 billion in the quarter, topping estimates of $24.2 billion. That was 11% higher from the year-ago quarter.
Wells Fargo (WFC) also posted quarterly earnings that beat expectations, while revenue came in below Wall Street forecasts. The financial heavyweight reported fourth-quarter earnings of 67 cents per share on revenue of $19.7 billion, compared with year-ago earnings of $1.38 a share on revenue of $20.9 billion.
BlackRock’s (BLK) fourth-quarter profit dropped 23%, while the bank reported net income of $1.26 billion in the same period a year earlier. Citigroup (C) posted net income of $2.5 billion, or $1.16 per diluted share, which slightly topped expectations for $2.3 billion, or $1.14 per share. However, profit fell 21%.
Finally, Goldman Sachs (GS) said its consumer lending business has lost more than $3 billion since 2020. This comes ahead of their fourth-quarter earnings scheduled to be released next week.
Bank stocks were down across the board Friday morning but moved upward later in the day. The KBW Nasdaq Bank Index (^BKX), a benchmark for the leading banks, closed the day up 0.7%.
In other stock-specific moves, shares of Tesla (TSLA) sank as much as 5% after the company cut prices for their Model 3 and Model Y vehicles. Tesla closed the day down about 1.0%.
The news appeared to drag down other automakers, including Ford (F) and General Motors (GM), which both fell more than 4.5%. Carvana (CVNA) shares sank nearly 13% as the company prepares to lay off more workers it contends with weak used-car sales, the Wall Street Journal reported on Friday.
Delta Air Lines (DAL) shares dropped 3% after the carrier forecast current-quarter profit below expectations amid higher operating costs. Space tourism startup Virgin Galactic (SPCE) shares surged 13% after the company announced that it was on track for a commercial launch in the second quarter of this year.
Finally, Amazon (AMZN) was up 3% on Friday. It gained 14% on the week for its best week since April 2020.
Core CPI, excluding volatile food and energy components, prices climbed 5.7% year-over-year and 0.3% over the prior month. The core CPI reading came in line as expected from Bloomberg economist forecasts.
In response to the data, investors grew more confident that the Fed could ease the pace of its tightening at its next monetary policy meeting, which starts Jan. 31.
“When it comes to the Fed, the release led to growing expectations that they would downshift the pace of rate hikes again at the February meeting, moving from 50bps last time down to 25bps,” Jim Reid and colleagues at Deutsche Bank wrote in an early-morning note Friday.
Central bankers have made clear they aren’t done with interest rate increases. Fed Chair Jerome Powell stressed on Tuesday the importance of stable inflation, which could lead the central bank to take actions that are necessary, even if not popular.
Philadelphia Federal Reserve Bank President Patrick Harker speaks with CNBC’s Steve Liesman (not pictured) after an interview ahead of the annual Kansas City Fed Economic Policy Symposium, in Jackson Hole, Wyoming, U.S., August 25, 2022. REUTERS/Ann Saphir
Elsewhere, bitcoin rose nearly 3% to trade around $18,854.39. The cryptocurrency reached a two-month high following December inflation data on Thursday. On the corporate news front, crypto exchange Crypto.com is cutting down its global workforce by 20% as the company says its navigating ongoing economic headwinds.
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Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.
It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.
The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.
Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.
TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.
The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 7, 2024.
BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.
The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.
On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.
“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.
“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”
Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.
BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.
The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.
BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.
It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.
The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”
Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.
This report by The Canadian Press was first published Nov. 7, 2024.
TORONTO – Canada Goose Holdings Inc. trimmed its financial guidance as it reported its second-quarter revenue fell compared with a year ago.
The luxury clothing company says revenue for the quarter ended Sept. 29 totalled $267.8 million, down from $281.1 million in the same quarter last year.
Net income attributable to shareholders amounted to $5.4 million or six cents per diluted share, up from $3.9 million or four cents per diluted share a year earlier.
On an adjusted basis, Canada Goose says it earned five cents per diluted share in its latest quarter compared with an adjusted profit of 16 cents per diluted share a year earlier.
In its outlook, Canada Goose says it now expects total revenue for its full financial year to show a low-single-digit percentage decrease to low-single-digit percentage increase compared with earlier guidance for a low-single-digit increase.
It also says it now expects its adjusted net income per diluted share to show a mid-single-digit percentage increase compared with earlier guidance for a percentage increase in the mid-teens.
This report by The Canadian Press was first published Nov. 7, 2024.
