Stocks surge as big banks kick off earnings season

U.S. equity markets rallied Tuesday as some of the country’s biggest banks kicked off earnings season.

The Dow Jones Industrial Average gained 596 points, or 2.6 percent, in the opening minutes of trading. The S&P 500 and Nasdaq Composite rose 2.5 percent and 2.9 percent, respectively. The early gains come after the S&P 500 lost 1 percent on Monday, coming off its best week since 1974.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 23976.97 +586.20 +2.51%
SP500 S&P 500 2828.93 +67.30 +2.44%
I:COMP NASDAQ COMPOSITE INDEX 8432.946027 +240.52 +2.94%

With financial reports for the first quarter just beginning, Wall Street analysts surveyed by FactSet expected S&P 500 earnings to fall 9 percent from a year ago, the first quarterly decline since the financial crisis.

Dow components JPMorgan Chase & Co. and Johnson & Johnson and the San Francisco-based lender Wells Fargo all released results.

JPMorgan Chase & Co. posted a 69 percent drop in profit from a year ago and set aside $6.8 billion to cover loan losses from the economic shutdown due to the COVID-19 pandemic. Both earnings and revenue were below expectations.

Ticker Security Last Change Change %
JNJ JOHNSON & JOHNSON 145.34 +5.57 +3.99%
JPM JP MORGAN CHASE & CO. 98.68 +0.49 +0.50%
WFC WELLS FARGO & COMPANY 32.03 +0.60 +1.92%

Wells Fargo set aside $3.1 billion to cover loan losses and reported a quarterly profit of 1 cent a share, missing estimates. Revenue of $17.7 billion also disappointed.

Johnson & Johnson reported top- and bottom-line results that topped estimates and hiked its quarterly dividend by 6.3 percent to $1.01 a share.

Amazon shares opened at a record high, crossing $2,200 for the first time. The stock needs to finish the day above $2,170.22 to post its highest close on record.

Beer-maker Anheuser Busch Inbev cut its dividend in half to 50 cents a share, a move that will save the brewer about $1.1 billion.

Ticker Security Last Change Change %
AMZN AMAZON.COM INC. 2,237.05 +68.18 +3.14%
BUD ANHEUSER-BUSCH INBEV 48.25 -1.15 -2.33%
ROKU ROKU INC 104.29 +7.73 +8.01%

Video-streaming service Roku soared after preliminary quarterly results showed the number of new subscribers jumped 37 percent year-over-year to 39.8 million as home viewership increases with Americans spending more time in their houses to limit the spread of the COVID-19 pandemic. The company withdrew its full-year guidance.

Commodities were mixed, with West Texas Intermediate crude oil falling 2.72 percent to $21.80 a barrel while gold traded up 0.7 percent at $1,773 an ounce.

U.S. Treasurys were little changed, with the yield on the 10-year note holding at 0.75 percent.

In Europe, Germany’s DAX climbed 1.55 percent while France’s CAC rose 0.88 percent. Britain’s FTSE slid 0.56 percent.

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Markets rallied across Asia, with Japan’s Nikkei up 3.13 percent, China’s Shanghai Composite climbing 1.59 percent and Hong Kong’s Hang Seng gaining 0.56 percent.

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