Here are the key updates investors should know to begin their trading day:
1. Closing Summary
On Friday, stock futures slightly dropped before the last trading session of the week. Despite the seemingly dull days since the start of 2024, major indexes are on track for weekly gains. The Dow Jones Industrial Average has risen by 0.65% this week, the S&P 500 by 1.77%, and the Nasdaq Composite by over 3%.
2. Calling on Reserves
This morning brings significant bank earnings announcements from JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo. U.S. banks have been managing challenges posed by high interest rates and increasing loan losses.
Additionally, they are facing upcoming stringent capital requirements. JPMorgan, the largest U.S. bank by assets, and Bank of America both experienced a decline in profits last quarter, attributed to regulatory fees linked to the regional banking crisis.
3. Moving Ahead and Upwards
Stay alert: Last month, the Consumer Price Index (CPI) saw an increase. The CPI, which measures what consumers pay for a specific set of goods and serves as a crucial inflation indicator, rose by 3.4% year over year in December.
This marks a reversal after two months of decline, with the index up by 3.1% in November and 3.2% in October. On Friday morning, there will be another look at inflation, with the release of producer price index data at 8:30 a.m. ET.
4. Tech Challenges
Google is trimming down its workforce by several hundred employees in departments like hardware, central engineering, and the team responsible for the voice-activated Google Assistant. This follows a trend in the tech sector, with Amazon recently announcing layoffs in its Prime Video, MGM Studios, Twitch, and Audible units.
Discord, a messaging platform, also stated on Thursday that it would be reducing its headcount. All three companies emphasized the importance of becoming more efficient. Google and Amazon mentioned reducing investments in certain areas to better align with product “initiatives” and “priorities.”
5. Bon Voyage
Delta Air Lines saw a more than twofold increase in its fourth-quarter profit, driven by robust travel demand, especially for international flights. The company reported results for the December quarter on Friday, surpassing Wall Street expectations.
However, it adjusted its 2024 earnings forecast down from previous estimates. CEO Ed Bastian mentioned that while business is thriving, the aviation industry still grapples with some supply chain challenges, such as extended repair and service times for planes.
Stocks had a small drop on Friday, but overall, major indexes are set for weekly gains. U.S. banks, like JPMorgan and Bank of America, are dealing with challenges. The Consumer Price Index went up in December. Google and Amazon are cutting jobs to be more efficient. Delta Air Lines made a good profit in Q4, but adjusted its 2024 earnings forecast due to industry challenges.