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The Dow Jones now is flat as markets prepare for a busy round of earnings reports from the banking sector. This morning, we'll be looking for earnings reports from JPMorgan Chase & Co. (NYSE: JPM), Citigroup Inc. (NYSE: C), and Wells Fargo & Co. (NYSE: WFC).
This could be the worst quarter for financial companies since Q4 2008. Read for more of what's moving the Dow today…
First, here are the numbers from Monday for the Dow, S&P 500, and Nasdaq:
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Now here are what I think will be the most important market events and stocks on Monday morning.
The Top Stock Market Stories for Tuesday
- The number of COVID-19 cases surged yet again on Tuesday, and testing continues to face delays across the country. Laboratories are falling behind with their turnaround times, according to the nation's two largest lab diagnostics firms. The number of U.S. cases remains above 3.3 million, forcing states across the country to scramble to prevent a wider outbreak. California, the nation's most populous state, announced that its two largest school systems will return remotely in the fall. The state also announced it will again shut down movie theaters, indoor restaurants, and bars. Meanwhile, 19 states are currently facing record seven-day averages in new daily cases.
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- Today is a critical day for earnings reports. This morning, JPMorgan Chase & Co. (NYSE: JPM) gained 1.6% after it reported stronger-than-expected earnings for the second quarter. The firm reported a 79% jump in trading revenue during the period's sharp volatility. The firm reported earnings per share of $1.38, topping consensus expectations of $1.04. Revenue came in at $33 billion, which surpassed Wall Street's average expectation of $30.3 billion.
- In addition to three large financial firms reporting earnings before the bell, we'll also be looking for results from Delta Air Lines Inc. (NYSE: DAL) and Fastenal Co. (NASDAQ: FAST). This could be very ugly with the stock market sitting back near levels not seen since before the crisis and equity values failing to align with the reality of the U.S. economy. According to Refinitiv, corporate profits are forecast to slump by $44 in the second quarter. Banking stocks are expected to see a profit decline north of 50%.
- Gold prices are off slightly this morning thanks to a stronger U.S. dollar.
Stocks to Watch Today: 3M, TSLA, NOK
- Shares of 3M Co. (NYSE: MMM) ticked higher after the industrial giant announced it is working with the Massachusetts Institute of Technology to develop a rapid COVID-19 testing kit. The partnership has received $500,000 in funding and commercial support from the National Institutes of Health.
- Have shares of Tesla Inc. (NASDAQ: TSLA) reached their peak? Shares surged another 10% on Monday before pulling back and finishing the day in the red. Shares continue to slide as investors worry that the stock valuation has reached unwarranted levels. The current Wall Street consensus price target for TSLA is roughly 50% of its current value. The said, the company will report earnings next week, perhaps setting off speculation that the stock could continue to rally.
- Finally, Finnish telecom giant Nokia (NYSE: NOK) announced it has created software that will allow mobile operators to update their broadcasting equipment from 4G to 5G without having to replace any equipment.
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.