Stocks traded mixed Wednesday afternoon, with traders digesting a slew of earnings results from big banks that largely topped expectations. The Dow set a fresh intraday record high as shares of Goldman Sachs advanced after the company reported better-than-expected quarterly results.
The S&P 500 erased earlier gains to trade lower, after the index jumped to record intraday and closing highs on Tuesday. The Nasdaq briefly broke back above 14,000 before turning slightly negative, with technology shares giving back some of Tuesday's gains as Treasury yields advanced.
Investors received earnings results from the banks including JPMorgan Chase (JPM) and Goldman Sachs (GS) Wednesday morning, which set the tone for the rest of first-quarter earnings reports in the weeks to come. JPMorgan Chase's investment banking and stock and bond trading revenues handily exceeded estimates, and the firm's profits got a boost after the bank released $5.2 billion in loan loss reserves, which had been shored up in case of souring loans during the pandemic. Goldman Sach's results handily exceeded estimates on booming investment banking and trading revenue.
For S&P 500 companies overall, Wall Street analysts are expecting a surge in corporate profits versus last year, with a firming economic backdrop and strong consumer spending set to boost companies' results.
“We could see upwards of 30% year-over-year earnings growth in the first quarter. That would be the most we’ve seen since coming out of the financial crisis," Ryan Detrick, chief market strategist at LPL Financial, told Yahoo Finance. Expectations are for about 25% earnings growth in the first quarter. And let’s not forget in the previous two quarters what happened: massive, massive beats.
"That bar is a little bit higher, but we think once again corporate America will step up and justify a lot of the valuations that we see here," he added.
Other risk assets also traded near all-time highs. Bitcoin prices (BTC-USD) reached a record high of more than $64,000, with shares of cryptocurrency exchange platform Coinbase (COIN) hitting the public markets in a direct listing on Wednesday.
4:12 p.m. ET: Tech stocks drop, pulling S&P 500 below record levels; Coinbase shares end below debut price
Here were the main moves in markets as of 4:12 p.m. ET:
Dow (^DJI): +53.62 (+0.16%) to 33,730.89
Nasdaq (^IXIC): -138.26 (-0.99%) to 13,857.84
Crude (CL=F): +$2.70 (+4.49%) to $62.88 a barrel
Gold (GC=F): -$10.50 (-0.60%) to $1,737.10 per ounce
10-year Treasury (^TNX): +1.5 bps to yield 1.6380%
2:35 p.m. ET: Stocks trade mixed, S&P 500 turns lower
The three major indexes were mixed in afternoon trading, with the S&P 500 erasing earlier gains to trade in negative territory.
The energy, materials and financials sectors outperformed in the blue-chip index, while information technology and consumer discretionary sectors lagged. A jump in shares of Goldman Sachs after the company's stronger than expected first-quarter earnings report this morning helped keep the Dow in positive territory.
1:33 p.m. ET: Coinbase shares open at $381 apiece in public debut; stock extends gains to more than $429 per share
Shares of Coinbase opened at $381 apiece Wednesday afternoon, following a protracted price discovery process on the Nasdaq. Shares immediately extended gains to reach well over $400, giving the stock a fully diluted market capitalization of more than $100 billion.
At $381, the price of Coinbase's first trade gave the stock a fully diluted valuation of about $99.5 billion and marked a jump of 52.4% over its reference price of $250 per share on the Nasdaq.
12:43 p.m. ET: S&P 500, Dow gain in intraday trading, while Nasdaq dips
Here's where markets were trading Wednesday afternoon in New York:
S&P 500 (^GSPC): +5.88 points (+0.14%) to 4,147.53
Dow (^DJI): +208.77 points (+0.62%) to 33,886.04
Nasdaq (^IXIC): -16.12 points (-0.12%) to 13,979.96
Crude (CL=F): +$3.08 (+5.12%) to $63.26 a barrel
Gold (GC=F): -$10.70 (-0.61%) to $1,736.90 per ounce
10-year Treasury (^TNX): +1.6 bps to yield 1.639%
12:13 p.m. ET: Fed Chair Powell says liftoff in rates unlikely before 2022
Federal Reserve Chair Jerome Powell, speaking at The Economic Club virtually in Washington, D.C., reiterated Wednesday that a near-term move on interest rates remained unlikely, given the current precarious recovery under way amid the ongoing pandemic.
“Before 2022, that would be this year. I think that would be highly unlikely," in regards to lifting interest rates from current near-zero levels, Powell said.
He added, however, that the Federal Reserve would likely start to taper its bond purchasing program before it moved on interest rates.
10:22 a.m. ET: Coinbase indicated to open at $340 per share after reference price set at $250 on the Nasdaq
Shares of Coinbase were indicated to open at $340 per share in the stock's public debut on the Nasdaq, after the reference price for the stock was set at $250 per share on Tuesday.
Cryptocurrency exchange Coinbase is going public via a direct listing, which differs from a traditional initial public offering in that no new shares will be issued in the process. Instead, existing shareholders will directly sell stock to the public.
Coinbase's opening trade could still fluctuate widely from this indicated price, as the price discovery process takes place throughout the morning.
9:30 a.m. ET: Stocks open mixed
Here's where markets were trading shortly after the opening bell:
S&P 500 (^GSPC): -1.25 points (-0.03%) to 4,140.34
Dow (^DJI): +11.06 points (+0.03%) to 33,688.33
Nasdaq (^IXIC): +4.34 (+0.03%) to 14,001.37
Crude (CL=F): +$1.28 (+2.13%) to $61.46 a barrel
Gold (GC=F): -$13.00 (-0.74%) to $1,734.60 per ounce
10-year Treasury (^TNX): +1.8 bps to yield 1.641%
7:36 a.m. ET: Stock futures mixed amid bank earnings
Here's where markets were trading ahead of the opening bell:
S&P 500 futures (ES=F): 4,136.50, up 3.75 point or 0.09%
Dow futures (YM=F): 33,554.00, down 16 points or 0.05%
Nasdaq futures (NQ=F): 14,015.50, up 39.75 points or 0.28%
Crude (CL=F): +$0.91 (+1.51%) to $61.09 a barrel
Gold (GC=F): -$4.00 (-0.23%) to $1,743.60 per ounce
10-year Treasury (^TNX): +0.4 bps to yield 1.627%
7:31 a.m. ET: Goldman Sachs shares jump after easily beating Q1 estimates, driven by surge in investment banking, trading revenue
Goldman Sachs posted first-quarter revenue that more than doubled over last year, with investment banking and trading business activity surging in the first three months of the year.
Net revenue of $17.70 billion came in well ahead of the $12.55 billion expected, and the prior year's $8.74 billion. The beat came amid a 47% jump in trading revenue, with equity sales and trading alone growing 68%. Earnings per share of $18.60 were also much better than the $10.06 anticipated, and net interest income of $1.48 billion grew 13% over last year.
“We have been working hard alongside our clients in preparation for a world beyond the pandemic and a more stable economic environment," Goldman Sachs CEO David Solomon said in a statement. "Our businesses remain very well positioned to help our clients reposition for the recovery, and that strength is reflected in the record revenues and earnings achieved this quarter.
7:18 a.m. ET Wednesday: JPMorgan Chase Q1 revenue tops estimates, with earnings boosted by $5.2 billion in released loan loss reserves
JPMorgan Chase (JPM) posted first-quarter adjusted revenue that handily exceeded expectations, and beat estimates on earnings per share as the company released billions of dollars worth of provisions shored up during the pandemic to guard against souring loans.
Adjusted revenue of $33.12 billion grew 14% over last year, with each of investment banking, fixed income sales and trading and equities sales and trading revenue easily topping estimates. On the bottom line, earnings per share of $4.50 were better than the $3.01 expected, according to Bloomberg consensus data, with these results boosted by $5.2 billion in net reserve releases. However, guidance for net interest income – or profits from the firm's core lending business – came in light at $55 billion, or slightly below the $55.12 billion expected.
JPMorgan's results reflect “strong underlying performance across our businesses, partially driven by a rapidly improving economy," CEO Jamie Dimon said in a press statement. "These results include a benefit from credit reserve releases of $5.2 billion that we do not consider core or recurring profits. We believe our credit reserves of $26 billion are appropriate and prudent, all things considered.”
Dimon added that the firm's consumer and community banking business segment has returned to pre-pandemic levels, with consumer spending rising 14% over the first quarter of 2019. Travel and entertainment expenses have grown more than 50% in March compared to February, he added.
“With all of the stimulus spending, potential infrastructure spending, continued Quantitative Easing, strong consumer and business balance sheets and euphoria around the potential end of the pandemic, we believe that the economy has the potential to have extremely robust, multi-year growth," Dimon said.
6:05 p.m. ET Tuesday: Stock futures trade little changed
Here's where markets were trading Tuesday evening:
S&P 500 futures (ES=F): 4,133.75, up 1 point or 0.02%
Dow futures (YM=F): 33,570, unchanged
Nasdaq futures (NQ=F): 13,976.00, up 0.75 points or 0.01%
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
Read more from Emily: