Stocks experienced a downward trend on Friday, influenced by a combination of factors including the commencement of first-quarter earnings reports from major U.S. banks and geopolitical tensions. Here’s a closer look at the key developments:
JPMorgan Chase, the largest U.S. bank by assets, reported robust first-quarter earnings of $4.44 per share, surpassing analysts’ expectations of $4.17. Although the revenue of $42 billion was in line with forecasts, there was a notable decline in net interest income, which fell by 4% from the previous quarter to $23.1 billion. Despite the positive earnings surprise, JPMorgan’s stock price dropped by 6.5%.
Citigroup also reported strong first-quarter profit, posting earnings of $1.58 per share, which exceeded estimates of $1.18. Net interest income saw a substantial increase of 16% year-over-year to $594 million. Initially, Citigroup’s shares rose in response to the earnings beat, but they later declined by 1.7%.
Wells Fargo delivered better-than-expected first-quarter earnings, with earnings per share of $1.20 compared to estimates of $1.06. Although this represented a slight decrease from the previous year’s earnings of $1.23 per share, revenue of $20.86 billion exceeded expectations. Despite the positive earnings surprise, Wells Fargo’s stock saw a slight decline of 0.4%.
BlackRock, a global investment management corporation, reported adjusted earnings of $9.81 per share for the first quarter, outperforming analysts’ estimates of $9.39. However, despite this positive earnings beat, the stock price dropped by 2.9%.
The technology sector also experienced significant movement on Friday. Advanced Micro Devices (AMD) fell by 4.2%, while Intel saw a larger decline of 5.2%. This was attributed to reports that Chinese officials had directed the nation’s largest telecom carriers to phase out foreign processors.
Arista Networks, a cloud networking company, experienced a notable decline of 8.5% following a downgrade by analysts at Rosenblatt. They downgraded their recommendation on Arista Networks from Buy to Sell, with a price target of $210.
In the pharmaceutical sector, Zoetis, a company specializing in animal health products, saw its stock price drop by 7.8% after concerns were raised about the safety and effectiveness of its pet arthritis drugs, Librela and Solensia, in an article published by The Wall Street Journal.
Ciena, a networking systems company, experienced a decline of 3.2% after Citi analysts initiated coverage with a Sell rating and a price target of $44. Citi cited limited immediate opportunities for gains from artificial intelligence as a reason for the Sell rating.
Finally, Morgan Stanley’s stock price fell by 0.8% on Friday, following a larger decline of 5.3% on Thursday. This was in response to reports of federal regulators probing the investment bank over its handling of wealth management clients who are at risk of money laundering.
Overall, these movements in the stock market on Friday reflect a combination of earnings results, geopolitical tensions, and specific company-related news affecting investor sentiment and market dynamics.