US STOCKS-Wall Street ends mixed despite bumper bank earnings

  • Reuters
  • Stock Market News
US STOCKS-Wall Street ends mixed despite bumper bank earnings
Credit: © Reuters.

* Goldman Sachs, Wells Fargo (NYSE: WFC ) up as profits jumps

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

* Coinbase soars on Nasdaq listing (Adds comments, details, updates to afternoon)

By Shivani Kumaresan, Shreyashi Sanyal and David French

April 14 (Reuters) - Wall Street indexes closed mixed on Wednesday, with the Nasdaq Composite .IXIC and S&P 500 .SPX falling despite another record intraday high for the latter and big banks' stellar results on the first day of earnings season.

Shares of Goldman Sachs Group Inc (NYSE: GS ) GS.N and Wells Fargo & Co WFC.N rose on bumper first-quarter profits.

Goldman capitalized on record levels of global dealmaking activity, and Wells reduced bad loan provisions and got a grip on costs tied to its sales practices scandal. Chase & Co's JPM.N shares fell despite the largest U.S. bank's earnings jumping almost 400%, as it released more than $5 billion in reserves to cover coronavirus-driven loan defaults. 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 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.

The KBW Regional Banking Index .KRX has outperformed the KBW Bank Index .BKX year to date, although the latter - which represents 24 of the largest U.S. banks - has beaten the index of smaller institutions over the last month.

"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 first quarter's best performers, rising 15% even as the Federal Reserve pledged to keep interest rates low in the near future. It rose on Wednesday.

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

Unofficially, the Dow Jones Industrial Average .DJI rose 54.87 points, or 0.16%, to 33,732.14, the S&P 500 .SPX lost 16.75 points, or 0.40%, at 4,124.84 and the Nasdaq Composite .IXIC dropped 138.26 points, or 0.99%, to 13,857.84.

The Nasdaq was weighed by technology-related stocks, including Apple Inc AAPL.O , Microsoft Corp MSFT.O and Tesla Inc TSLA.O .

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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