Wall Street opens flat as big banks kick off earnings season
U.S. stock indexes opened flat today as Goldman Sachs and JPMorgan kicked off the first-quarter corporate earnings season, against the backdrop of a swift vaccine-led global economic recovery
The Dow Jones Industrial Average fell 8.32 points, or 0.02 per cent, at the open to 33,668.95.
The S&P 500 opened lower by 0.01 points, or -0.00 per cent, at 4,141.58, while the Nasdaq Composite gained 7.98 points, or 0.06 per cent, to 14,004.08 at the opening bell.
Goldman Sachs today blew past Wall Street expectations for first-quarter profit, as the investment bank behemoth capitalised on record levels of global dealmaking activity.
Net profit at Goldman jumped to $6.7bn in the quarter to 31 March from $1.12bn in the same period a year ago.
JP Morgan also reported a surge in profit in the first quarter, boosted by a strong performance in its trading and investment banking divisions.
The Wall Street bank posted net income of $14.3bn in the first three months of the year, up from $2.9bn a year earlier.
Today marks a big day for the Nasdaq, ahead of crypto platform Coinbase’s keenly anticipated IPO, which is expected to value the company at $65.3bn, according to Michael Hewson, chief market analyst at CMC Markets UK,
FTSE up
London’s main market edged higher in the afternoon, with both the FTSE 100 and 250 seeing a swing upwards after a flat start to the day.
The FTSE 100 was up 0.45 per cent at just after 3pm, while the FTSE 250 was up 0.31 per cent.
At the open this morning London’s markets were virtually flat, with the FTSE 100 up by just 0.06 per cent and the FTSE 250 down 0.12 per cent.
The FTSE 100 has risen 6.5 per cent so far this year as huge vaccine rollouts and government stimulus boosted optimism about a faster economic rebound. But a recent surge in global Covid-19 cases and concerns of higher inflation have put a lid on the gains.
“We see reasons to expect periodic bouts of higher volatility in the near term,” chief investment officers at UBS Global Wealth Management said in a note to clients.
“First, investors are likely to be torn between optimism over accelerating growth and worries over higher inflation. Second, optimism over the course of the pandemic is being tested by the spread of new variants of the virus.”
Winners and losers
This morning’s best performer at the open was Just Eat Takeaway, which was up 6.8 per cent. Yesterday Just Eat posted some encouraging results, with orders placed in Q1 up 79 per cent on the same period in 2020.
JD Sports was the second-best performer, up nearly 2.9 per cent, following profit forecast-beating results also delivered yesterday.
United Utilities, a water company, was this morning’s worse performer, down 2.3 per cent, followed by Severn Trent, down 1.4 per cent.
European stocks inched up today, as upbeat earnings from German software firm SAP and French luxury goods maker LVMH offset concerns about a potential setback to the continent’s Covid-19 vaccination programme.
The pan-European STOXX 600 index rose 0.1 per cent in early morning trading, with technology and personal & household goods sectors among the top gainers.
SAP rose 2.6 per cent after it nudged its outlook for 2021 revenue higher after reporting first-quarter results that showed gains in cloud sales.