Wall Street closed in the red on Thursday after another grim inflation report and disappointing banking results. Which marked a bleak start to the second-quarter corporate earnings season.
At first, the three major US stock indices fell hard After the results of the second quarter of c. B. Morgan Chase s Morgan Stanley. I mentioned both banks Less Profits He warned of an impending economic slowdown. Losses narrowed as the session progressed.
The Standard & Poor’s 500 It fell 0.3 percent Dow Jones 0.5% lost. The Nasdaq It ended with some changes. c. B. Morgan Chase It posted a sharp drop in profits last quarter, below expectations. your CEO, Jimmy DiamondHe reaffirmed his pessimistic view of the economy.
While, Wholesale inflation rose 11.3% in June compared to the previous year. This comes after a worrying report on Wednesday showing that consumer prices remain high.
Meanwhile, the results c. B. Morgan Chase It was below estimates as the banking giant reported a 28 per cent drop in quarterly profit and set aside additional funds in case of bad loans.
JPMorgan executives confirmed this US consumers will hold up relatively well If there is a recession, but they warned of economic headwinds “very likely” to affect growth.
The JPMorgan shares fell 4.4 percent. Morgan Stanley shares fell 2.6 percent, which missed estimates.
“There has been an irrational response to the results of JPMorgan and Morgan Stanley,” said Jay Hatfield, CEO and portfolio manager at InfraCap. “It was no surprise that investment banking was weak.”
Poor banking results confirm “We are now in the process of the very real possibility of declining profits.”Adam Sarhan of 50 Park Investments said, referring to the possibility of lower profits for two consecutive quarters compared to the same period last year.
This can lead to lower (stock) prices.Sarhan said. “Because first it slows down on Main Street, and then you see profits slow down on Wall Street.”
However, the Federal Reserve Governor, Christopher WallerSo, he said so US economic data is stronger than expectedThat would support a three-quarter increase in interest rates than last month’s increase to combat spiraling inflation.
Increase the benchmark interest rate by one point It will be the largest since at least 1990.
Waller also said that while fears of a recession increased, He believes that a strong US labor market means the economy can avoid a recession.
At the same time, the main US oil contract, West Texas MiddleAnd the decreased five percent Amid growing fears of a global recession, dealers said.
(With information from AFP)