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JPMorgan Chase ( JPM ) down after NII forecast miss
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Citigroup ( C/PN ) eases after lower Q1 profit
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Indexes down: Dow 0.94%, S&P 1.01%, Nasdaq 1.18%
(Updated at 11:26 a.m. ET/ 1526 GMT)
By Shashwat Chauhan and Shristi Achar A
April 12 (Reuters) -
The blue-chip Dow and the S&P 500 were on track for weekly
losses on Friday after most megacap growth stocks and chipmakers
retreated, while some big banks fell after reporting dour
quarterly earnings.
JPMorgan Chase & Co ( JPM ) dropped 5.9% after the bank's
forecast for its income from interest payments came in below
analysts' expectations.
Wells Fargo ( WFC ) edged 0.4% lower after reporting a more
than 7% fall in first-quarter profit, as it earned less from
customer interest payments. Citigroup ( C/PN ) lost 2.8% after its
first-quarter profit fell.
The S&P 500 banks index shed 3.3%, hitting its
lowest level in nearly a month.
Falling megacap growth stocks weighed on the three indexes,
with Nvidia ( NVDA ), Tesla and Meta Platforms ( META )
down over 1% each.
"Markets have run up a lot recently, so investors may be
looking for some excuses here and there in order to back off on
their overly optimistic positioning," said Jason Pride, chief of
investment strategy & research at Glenmede.
"After pretty major run-ups, you can find that the
little bit of disappointing news that comes out can actually be
the driving force for a sell-off."
Advanced Micro Devices ( AMD ) and Intel ( INTC ) lost
4% and 3.6%, respectively after a report that Chinese officials
had told the country's largest telecom firms earlier this year
to phase out foreign chips that are key to their networks by
2027.
Ten of the 11 major S&P 500 sectors were trading lower, with
information technology leading declines, down 1.3%.
The Dow and the S&P 500 eyed weekly losses as
sentiment was roiled this week following a
hotter-than-anticipated inflation reading that pushed traders to
scale back enthusiasm around the U.S. central bank cutting
interest rates.
Money market participants see an about 56% chance of the Fed
bringing in the first interest-rate cut in July, according to
the CME FedWatch Tool.
Meanwhile, Boston Fed President Susan Collins is eyeing a
couple of rate cuts this year, amid expectations that it could
take some time for inflation to return to its targeted level.
Investors now await Kansas City Fed President Jeffrey Schmid
and his Atlanta counterpart Raphael Bostic's comments later in
the day, for clues on the central bank's rate outlook.
On the data front, U.S. consumer sentiment ebbed in April,
while inflation expectations for the next 12 months and beyond
increased, a survey showed.
The CBOE Volatility Index, also known as Wall
Street's "fear gauge", hit its highest level since October 2023.
At 11:26 a.m. ET, the Dow Jones Industrial Average
was down 359.95 points, or 0.94%, at 38,099.13, the S&P 500
was down 52.45 points, or 1.01%, at 5,146.61, and the
Nasdaq Composite was down 193.92 points, or 1.18%, at
16,248.28.
Energy stocks bucked the trend to gain 0.4%,
tracking higher crude prices on heightened tensions in the
Middle East.
Declining issues outnumbered advancers for a 2.42-to-1
ratio on the NYSE and for a 2.79-to-1 ratio on the Nasdaq.
The S&P index recorded 12 new 52-week highs and eight new
lows, while the Nasdaq recorded 33 new highs and 124 new lows.