Corona Virus
Stay Safe, FollowGuidance
Fetching Location Data…
Lukman Otunuga

Earnings season kicks off this week, with JPMorgan releasing its Q4 2020 earnings before the US markets open on Friday 15th January.

Bank stocks have marched into the New Year on a firm note, driven by some progress on the vaccine front and renewed hopes over global economic growth.

“JPMorgan which boasts the biggest market capitalization of all US banks is up over 10% year-to-date, after concluding 2020 almost 9% lower.”

Market expectations

Sentiment towards the American multinational investment bank will most likely be influenced by the pending earnings report on Friday. According to Bloomberg, the consensus earnings per share estimates stand around $2.62 per share on $28.65 billion in revenues. For a full year, earnings are projected to decline by almost 28% to $7.77 per share, while full-year revenues of 120.26 billion would increase by 1.32%.

Will history repeat itself?

“2020 was a rough year for the banking sector as disruptions created by the the coronavirus pandemic hit consumers and businesses.”

However, JPMorgan was able to deliver mixed results in Q3 as the company’s trading division saw revenue surge by 30%.

It will be interesting to see whether the US bank will replicate such a feat in the final quarter of 2020 – especially when factoring in the bullish performance in stock markets.

What to look out for

One of the key things to look out for in the earnings report will be the loan-loss provision – something that will indicate whether the lenders have regained confidence after the pandemic drained earnings.

Banks were under the mercy of lower interet rates last year while COVID-19 created extraordinary levels of uncertainty. Such resulted in weak consumer spending which dealt a painful blow to the consumer banking side of the business.

Taking a look at the technicals

Should earnings meet or exceed market expectations, this could boost buying sentiment towards JPMorgan shares in the near term.

JPMorgan shares are trading above $140 as of writing. There have been consistently higher highs and higher lows on the weekly timeframe while the MACD trade to the upside. A solid weekly close above $140 may open the doors to fresh all-time highs beyond $141.66.

“Shifting our focus back to the fundamentals, the medium to longer term outlook may be heavily influenced by the pace of economic recovery which is linked to coronavirus infections and global vaccinations.”

Open your FXTM account today

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.