US open: Stocks little changed despite upbeat Goldman Sachs, Citi earnings
US equity markets were little changed on Wednesday, even though banking heavyweights Goldman Sachs and Citi posted positive earnings, while the dollar rebounded from the previous session's Donald Trump inspired fall.
The Dow Jones Industrial Average and the S&P 500 were flat at 19,819.72 and 2,269.47 respectively, and the Nasdaq was up 0.19% to 5,549.12 at 1535 GMT.
Meanwhile, oil prices dropped on the strength of the dollar. West Texas Intermediate fell 1.86% to $51.52 per barrel and Brent crude was down 1.89% to $54.44.
The greenback was up 0.73% versus the pound to 0.8114, 0.19% against the euro to 0.9352 and 0.62% versus the yen to 113.32.
Goldman Sachs and Citi followed mostly positive quarterly earnings from its peers JP Morgan Chase, Bank of America, Wells Fargo and Morgan Stanley.
Goldman Sachs’ quarterly profit surged as it benefitted from the increase in trading following Trump’s surprise election victory and a hike in interest rates. The bank generated $2.15bn in profit, up from $574m in the same period in 2015, when it paid a $5bn legal settlement, while revenue rose by $900m to $8.17bn.
Citi also gained from a surge in trading, as it made $1.14 a share, which topped forecasts of $1.12, on revenue of $17.01bn, slightly missing expectations of £17.3bn. The bank’s net income rose 7% to $3.51bn.
On the data front, the US consumer price index rose 0.3% in December, after a 0.2% gain in November. In the 12 months through to December, the index increased 2.1%, the largest year-on-year gain since June 2014.
The NAHB housing market index fell to 67 in December from a reading of 69 the previous months, which was revised down from 70. Analysts had expected a drop to 69.
Michael Hewson, chief market analyst at CMC Markets, said: “The latest inflation numbers for December showed that despite the higher dollar inflationary pressure has continued to build within the US economy, while investors will be looking keenly towards tonight’s speech by Federal Reserve chief Janet Yellen, for any further clues as to how the Fed’s thinking on what is likely to happen with the US economy over the next few months.”
Yellen will make a speech on the goals of monetary policy at 2000 GMT.
In corporate news, uranium miner Cameco Corp plunged 14.17% after saying late on Tuesday that it will cut 10% of its workforce and warned on earnings.
Chip maker Qualcomm rose 2.03% as it emerged the Federal trade Commission filed a monopoly complaint against the company.
JP Morgan was up 0.78% as it denied any wrongdoing in the settlement of a case brought by the government that claimed the bank discriminated against black and Hispanic mortgage seekers.
Netflix is due to report earnings after the close.