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While you were sleeping: JPMorgan Chase, Citigroup fall as banks kick off earnings

Updated: Energy stocks also declined after concerns about increased US production.

Margreet Dietz
Fri, 13 Oct 2017

Wall Street slipped, after touching record highs earlier in the day, as shares of JPMorgan Chase and Citigroup fell after the US banks posted quarterly earnings at the start of the new results season.

JPMorgan Chase traded 0.9% lower and Citigroup lost 3.4%, even as both banks beat analysts' expectations.

"The results were solid but not exceptional," Morningstar analyst Jim Sinegal said about JPMorgan Chase, according to Reuters.

Bank of America and Wells Fargo, which are both slated to report their latest earnings on Friday, fell 1.4% and 0.7% respectively.

"The risk is similar to the second quarter in that stocks are being priced for perfection," Bryan Reilly, senior investment analyst at CIBC Atlantic Trust, told Reuters. "But the strength in the global economy has accelerated and a weakening dollar should set up companies for very healthy beats in Q3."

At the close of trading in New York, the Dow Jones Industrial Average fell 31.88 points, or 0.14%, to 22,842.01. The Nasdaq Composite Index slipped 0.18% to 6591.51 and the Standard & Poor's 500 Index eased 0.17% to 2550.93.

Dow hits intraday highs
Earlier in the day, the Dow touched a record high of 22,884.82, while the S&P 500 touched a record high 2555.33 and the Nasdaq reached a record 6613.50.

The Dow fell as declines in Walt Disney and Nike, down 1.5% and 1.1% respectively, outweighed gains by Microsoft and United Technologies, up 0.9% and 0.8% respectively.

AT&T dropped 5.8% after the owner of DirecTV said it lost 90,000 US video subscribers in the quarter.

"It should be clear that DirecTV, like all of its cable peers, is suffering from the ravages of cord-cutting," Craig Moffett, analyst at MoffettNathanson, told Reuters. "It is reasonable to expect a weak quarter for the whole pay-TV industry."

Energy stocks declined with the price of oil amid concern about increased US production at a time the world's major oil producers are trying to curb output. US crude for November delivery fell 1.4% to $US50.60 a barrel.

In the latest US economic data, a Labour Department report showed its producer price index for final demand climbed 0.4% in September, following a 0.2% increase in August.

Investors will scrutinise reports on the consumer price index and retail sales, both due on Friday, to gauge the outlook for inflation and the odds of a third interest rate increase by the Federal Reserve before the end of the year.

In Europe, the Stoxx 600 Index ended the day little changed from the previous close. France's CAC 40 Index was down 0.03%, Germany's DAX Index rose 0.1% and the UK's FTSE 100 Index added 0.3%.


Margreet Dietz
Fri, 13 Oct 2017
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While you were sleeping: JPMorgan Chase, Citigroup fall as banks kick off earnings