Wall Street mixed in early trading (4/09)

Wall St mixed in early trading

By Kiran Stacey, 4/17/19

US equities fluctuated on Friday morning as positive results from Citigroup and General Electric struggled to bolster confidence in financial stocks.

Citigroup reported a trading profit for the first time in six quarters. That translated into a loss per share after a reset in the price of convertible preferred stock in January, but the loss was narrower than analysts had expected.

Much of that performance appeared to have already been priced in, with Vikram Pandit, Citi’s chief executive, having already said the company enjoyed a profitable January and February, and Citi’s shares fell 3.2 per cent to $3.88. Performance from other banks was mixed, with Bank of America picking up 1.1 per cent to $10.45 but Wells Fargo losing 0.5 per cent to $19.36.

GE meanwhile announced a higher profit than expected, helped by good performance in its energy operation. But fears remained for the health of its finance arm, GE Capital, as consumer credit losses defaults continued to rise. GE’s shares fell 0.9 per cent to $12.16.

JPMorgan, which gained some ground on Thursday after reporting better results than expected, fell 1.4 per cent to $32.79.

Regional banks were lifted after BB&T surprised the market with its earnings, boosting confidence that the bank, which is one of the largest US banks not to have cut its dividend, could continue to make its payments to shareholders. Its shares rose 4.7 per cent to $22.06, giving further confidence to the sector after Regions Financial surged in the previous session having said it was profitable in the first quarter.

The benchmark S&P 500 index gave up early gains and by mid-morning was 0.1 per cent down at 864.64 points, but the Dow Jones Industrial Average held on to fractional gains at 8,129.02 points. Equities remained in line for their sixth weekly gain for the first time since the market peaked in November 2007.

“If the majority of investors believe the rally has gone too far, it is sure to go further,” said David Kreinces, portfolio manager at ETF PM. “I think the S&P has  a pretty good shot at 900 before it sees some pull back.”

The Nasdaq Composite index fell furthest, losing 0.6 per cent to 1,660.82 after some of the optimism on Wall Street was tempered as the market digested results from Google on Thursday.

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