Stocks tumbled as techs lost their winning ways on Friday, as investors looked for inspiration from big bank results to kick off the earnings season.
The tech-heavy Nasdaq Composite (^IXIC) fell 0.9%, while the S&P 500 (^GSPC) fell 0.7%. The Dow Jones Industrial Average (^DJI) fell 0.6%, or more than 200 points.
Stocks fell on Thursday after the “Magnificent 7” tech names gave way to renewed impetus from AI tailwinds. Investors took comfort from a lower-than-expected gain in headline inflation after being spooked by a surprisingly warm consumer price print.
Investors scrutinize the quarterly results of Wall Street's big banks to gauge the potential impact if interest rates are higher than expected this year.
BlackRock's ( BLK ) results kicked off the earnings season before the bell on Friday, amid hopes that corporate updates would renew the stock's early-year rally. Shares in the world's largest asset manager pared pre-market gains after the company posted a 36% jump in profit.
Shares of JPMorgan ( JPM ) fell after missing its profit targets as CEO Jamie Dimon raised concerns about “inflationary pressures” and Federal Reserve policy. Wells Fargo ( WFC ) and Citigroup ( C ) traded in the green after their reports.
Meanwhile, precious metals continued to shine: gold (GC=F) rallied above $2,400 to hit another fresh record, and silver (SI=F) traded at its highest since early 2021. Demand is thought to be driven by investors seeking safety amid moderate growth. Eastern tensions but shunning US government bonds in the face of inflation concerns.
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Oil prices will touch 2024 as tensions rise in the Middle East
Oil futures rose as much as 3% on Friday on reports that Israel was preparing for an imminent attack from Iran on government targets on Saturday.
West Texas Intermediate (CL=F) futures broke above $87 a barrel, while international benchmark Brent (BZ=F) touched a session above $92 a barrel.
“The rise in tensions between Israel and Iran signals to traders that it could get worse before it gets better, and there seems to be a lot of options buying going into the weekend, putting upward pressure on futures prices,” Dennis said. Kiesler, senior vice president at BOK Financial, said in a note to clients on Friday.
Crude prices have soared this year amid continued production cuts by oil bloc OPEC+ and tensions stemming from the Israel-Hamas war. Ukrainian drone strikes against Russian refineries also upended the future.
WTI is up 21% year-to-date, while Brent is up roughly 20% over the same period.
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Jamie Dimon makes a good point for Yahoo Finance on interest rates
A fun call now with reporters and JPMorgan (JPM) CEO Jamie Dimon and CFO Jeremy Barnum.
The topic, of course, is earnings, but also Dimon's views on rates and the economy.
Dimon made a good point for me on rates. I asked Barnum about how the company is preparing for “longer high” interest rates:
“I want to point out that the rates themselves are not so important. What matters is why – is it because of stagnation? It's obviously negative. Or is it because of healthy growth? It's actually very good.”
Dimon said he “didn't predict” a recession.
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