US STOCKS-S&P 500 dips off record high, Dow rises on bank earnings

  • Reuters
  • Stock Market News
US STOCKS-S&P 500 dips off record high, Dow rises on bank earnings
Credit: © Reuters.

* Goldman Sachs up as profit jumps on record dealmaking

* JPMorgan (NYSE: JPM ) falls despite profit surging nearly five-fold

* Coinbase jumps on Nasdaq listing

* Dow up 0.36%, S&P 500 down 0.32%, Nasdaq down 0.60% (Adds comments, details, updates to afternoon)

By Shivani Kumaresan, Shreyashi Sanyal and David French

April 14 (Reuters) - The S&P 500 .SPX dipped after hitting a record high for the fourth session in five and the Dow Industrials .DJI rose on Wednesday, as Wall Street banks kicked off earnings season with first-quarter numbers that lifted hopes for a strong corporate rebound.

Goldman Sachs Group Inc (NYSE: GS ) GS.N rose 3.4% after it reported a massive jump in profit, capitalizing on record levels of global dealmaking activity. Chase & Co's JPM.N shares fell 1.4% even as the largest U.S. bank's earnings jumped almost 400%, as it released more than $5 billion in reserves to cover coronavirus-driven loan defaults. Fargo & Co WFC.N jumped 5.5% after the bank bounced back to a profit of almost $5 billion, ahead of Wall Street estimates, as it reduced bad loan provisions and got a grip on costs tied to its sales practices scandal. bank earnings were strong, but the market expected them to be strong," said Christopher Grisanti, chief equity strategist at MAI Capital Management.

"So the question becomes how do the bank stocks rise more from here. That's not clear. They have had a nice ride. I think there will be other places to make money more easily in the future."

Despite bumper trading and investment-banking revenue, lending by both JP Morgan and Wells Fargo (NYSE: WFC ) fell from a year ago. Investors will be watching this metric carefully in the upcoming earnings of smaller banks, which are more focused on traditional lending and deposit-taking.

"Financials have done well for a while, so we're happy with that now but will we reach a point of diminishing returns in that sector? I don't know," said Drew Horter, president and chief investment officer of Tactical Fund Advisors in Cincinnati.

The S&P 500 financials sector .SPSY was one of the best performers in the first quarter, rising 15% even as the Federal Reserve pledged to keep interest rates low in the near future. It rose a further 0.8% on Wednesday.

The S&P 500 energy sector .SPNY was the largest gainer among the 11 sub-indexes, jumping 3.1% as it tracked higher oil prices. O/R

At 2:41 p.m. ET, the Dow Jones Industrial Average .DJI rose 121.26 points, or 0.36%, to 33,798.53; and the S&P 500 .SPX lost 7.62 points, or 0.18%, at 4,133.97.

The Nasdaq Composite .IXIC dropped 84.01 points, or 0.6%, to 13,912.09, with high-flying technology stocks including Apple Inc AAPL.O , Microsoft Corp MSFT.O and Tesla Inc TSLA.O weighing on the index.

Coinbase Global Inc COIN.O jumped upon its listing on the Nasdaq on Wednesday. Its shares opened at $381 versus a reference price of $250. and blockchain-related firms including Riot Blockchain RIOT.O and Marathon Digital Holdings MARA.O fell after soaring ahead of Coinbase's debut and as bitcoin hit a record high of over $63,000 on Tuesday.

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