Yahoo Finance Stocks - Wall Street Flat After Mixed Bank Earnings
Investing.com – Wall Street was flat on Tuesday after mixed earnings from Goldman Sachs (NYSE:GS), JP Morgan and Wells Fargo (NYSE:WFC) reminded investors of uncertainties to the economic outlook - and of some negative consequences of interest rate cuts from the Federal Reserve.
The Dow Jones Industrial Average rose 14 points or 0.1% by 9:45 AM ET (13:45 GMT), while the S&P 500 was down half a point or 0.1% and the Nasdaq composite fell 3 points or 0.1%.
JP Morgan reported better-than-expected earnings, but its interest margin slipped, just a day after Citigroup (NYSE:C) also reported a similar fall. The results caused concerns that lower interest rates are hurting profits on lending. That's especially worrying, given that the banks' U.S. lending operations, notably to consumers, have performed better than their markets-based businesses.
The Federal Reserve is expected to cut interest rates by 25 basis points at the end of the month. JPMorgan chief financial officer Marianne Lake told analysts that the bank's new forecasts, which included a cut in expectations for net interest income, are based on assumptions of three rate cuts this year.
JPMorgan (NYSE:JPM) inched down 0.2%, while Goldman Sachs rose 2.3% after its results were better than expected, despite a 6% fall in quarterly profit. Wells Fargo slipped 0.7% - also on lending margin concerns - even though earnings topped forecasts.
In other news, Domino’s Pizza slumped 4.7% after its sales were below estimates, while Johnson&Johnson (NYSE:JNJ) fell 0.8% after the company was unable to give clear guidance on the cost of legal proceedings that claim its talcum powder caused ovarian cancer.
Elsewhere, Facebook (NASDAQ:FB) rose 0.6% ahead of a grilling in the Senate on its Libra digital currency project; Boeing (NYSE:BA) gained 0.2% and Beyond Meat was up 1.1%.
In commodities, crude oil rose 0.5% to $59.92 a barrel. Gold futures were flat at $1,413.85 a troy ounce, while the U.S. dollar index, which measures the greenback against a basket of six major currencies, was up 0.4% to 96.905. The dollar hit a two-year high against sterling on perceptions that a "hard" Brexit is increasingly likely.
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