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Afternoon Note

Good Old-Fashioned Earnings

By Charles Payne, CEO & Principal Analyst
10/15/2019 1:48 PM

It’s been a strong session for the market, powered by good old-fashioned earnings.  Imagine that.   JP Morgan (JPM) shares are one of the biggest winners of the session, but its success is built on the American consumer.

Jamie Dimon Comments:

Jamie Dimon, Chairman and CEO, commented on the financial results: “JPMorgan Chase delivered record revenue this quarter, demonstrating broad-based strength and the resilience of our business model despite a more challenging interest rate backdrop. In Consumer & Community Banking, we had strong deposit and client investment asset growth. Our consumer lending businesses benefited from our continued investments and a favorable environment for borrowers, which helped drive healthy volumes in Home Lending and Auto and strong loan growth in Card.”

Dimon added: “We had record third quarter IB fees with particularly strong performance in DCM and ECM, and year-to-date we maintained our #1 global ranking with share gains across products and regions. Markets performance was solid, reflecting improved client activity – particularly in Fixed Income. Commercial Banking turned in a solid performance with continued momentum in investment banking and treasury services. And in Asset & Wealth Management, both AUM and client assets were a record helped by strong net inflows into long-term and liquidity products.”

Dimon concluded: “In the U.S. economy, GDP growth has slowed slightly. The consumer remains healthy with growth in wages and spending, combined with strong balance sheets and low unemployment levels. This is being offset by weakening business sentiment and capital expenditures mostly driven by increasingly complex geopolitical risks, including tensions in global trade. Regardless of the operating environment, JPMorgan Chase will continue to serve our customers, clients and communities globally, while investing in innovation, talent, technology, security and controls.”

The Financials and Healthcare are the clear leaders in today’s session, followed by Communications Services.  The safe-haven Consumer Staples, Real Estate and Utilities are the laggards.

S&P 500 Index

+1.09%

 

Communication Services (XLC)

+1.69%

 

Consumer Discretionary (XLY)

+0.90%                                                                 

 

Consumer Staples (XLP)

 

-0.45%

Energy (XLE)

+1.38%

 

Financials (XLF)

+1.90%

 

Health Care (XLV)

+1.89%

 

Industrials (XLI)

+1.06%

 

Materials (XLB)

+1.16%

 

Real Estate (XLRE)

 

-0.20%

Technology (XLK)

+1.20%

 

Utilities (XLU)

 

-0.31%

The Dow is holding onto gains, but it is now looking for additional impetus to keep the rally moving.  On that note, there is considerable resistance at these levels, with the next big test being 27,219. Remember, now that the market is moving, the breakout must occur during this earnings period.

 


 

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