Fred Imbert,Maggie Fitzgerald
Dow Jones Industrial Average futures traded 156 points higher, or 0.6%. S&P 500 and Nasdaq-100 futures gained 0.4% each.
JPMorgan Chase rose more than 1% in the premarket after the banking giant posted earnings and revenue that beat analyst expectations. The bank’s strong results were driven in part by a 79% surge in trading revenues amid the market’s volatile swings in the second quarter.
Wells Fargo slid more than 3% in premarket trading after reporting a $2.4 billion loss for the quarter, its first quarterly loss since the financial crisis. The bank also cut its dividend to 10 cents from 51 cents a share.
Citigroup is set to report later on Tuesday.
While corporate profits are expected to fall by 44% in the second quarter, the financial sector is expected to see a more than 52% decline in profits, according to Refinitiv.
“What’s so influential about the banks reporting early in the earnings season in times like these is we’re really counting on banks’ management team’s view on what’s going on,” Susan Schmidt, head of U.S. equities at Aviva Investors, told CNBC. “Banks are the foundation of our U.S. economy. They are there to provide loans to small businesses and to manage the retail consumers’ deposits.”
The Nasdaq Composite dipped 2.1%, pushed lower by losses in Netflix, Microsoft, Amazon and Facebook. The technology-heavy index rose nearly 2% at its session high on Monday.
The Nasdaq-100, which is made up of the 100-largest nonfinancial companies in the Nasdaq Composite, briefly traded above 11,000 for the first time before falling 2.2%.
Earlier in the session on Monday stocks were helped by news that Pfizer and German biotech BioNTech SE were granted fast track designation by the Food and Drug Administration for two of the companies’ four vaccine candidates against the coronavirus.
Cases continued to hit record levels across the U.S. over the weekend as a number of hot-spot states continue to see Covid-19 deaths gradually rise, according to data compiled by Johns Hopkins University. California Gov. Gavin Newsom is ordering some indoor businesses — including restaurants, bars, movie theaters and museums — to reclose statewide as new cases continue to rise.