Nasdaq Index, Dow Jones, S&P 500 News: Bank Earnings Kickstart Q2 Season With Mixed Results

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Daily Wells Fargo & Company

Bank Earnings in Focus

Wells Fargo shares dropped 6% in pre-market trading after reporting lower-than-expected net interest income for Q2. The bank also forecasts a 7% to 9% decline in net interest income this year. JPMorgan, however, posted higher-than-anticipated Q2 revenue, driven by strong investment banking fees, though its shares edged lower.

Tech Sector Weakness

Thursday saw a significant market rotation, with investors selling off Big Tech stocks:

The S&P 500 fell 0.88%
Nasdaq Composite lost 1.95%
Both indices broke seven-day winning streaks
Nvidia declined 5.6%
Meta Platforms dropped 4.1%

The Dow Jones Industrial Average outperformed, gaining a modest 0.08%.

Economic Data and Market Sentiment

The June Consumer Price Index (CPI) reported a 0.1% monthly decline, prompting investors to shift towards sectors that could benefit from potential Federal Reserve rate cuts. The Russell 2000 small-cap index surged 3.6% in response.

Upcoming economic releases include:

Rotation to Dictate Second Half Trend

Warren Pies, strategist at 3Fourteen Research, suggests that Thursday’s rotation could be indicative of market trends for the second half of the year. He anticipates that upcoming corporate earnings and a credit expansion narrative will drive market performance.

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