U.S. Stocks Mixed As Market Needs Additional Catalysts To Move Higher

Big Banks Beat Earnings Estimates

The third-quarter earnings season has just started. JPMorgan Chase reported revenue of $29.15 billion and GAAP earnings of $2.92 per share, smashing analyst estimates which called for earnings of just $2.19 per share. Meanwhile, Citigroup’s earnings were also much better than analyst forecasts.

Analysts have projected that banks will have to boost their reserves significantly, putting pressure on earnings. However, it looks like stimulus measures helped consumers, and banks’ reserves grew less than expected.

S&P 500 futures are mixed in premarket trading as the market will likely need additional catalysts to continue its upside move after the recent rally.

China’s Trade Data Highlights A Robust Recovery

China reported that its Exports increased by 9.9% year-over-year in September while Imports grew by 13.2%. The Imports report was especially strong since analysts expected growth of just 0.3%. China also reported that Vehicle Sales increased by 12.8% year-over-year despite the negative impact of the pandemic.

China’s economic reports indicated that the rebound of the Chinese economy continued despite the challenging situation with coronavirus in the world.

This is good news for the world economy, but it remains to be seen whether Chinese data will be able to provide additional support to U.S. stocks at current levels.

After the recent rally, S&P 500 is not far away from all-time highs, and a combination of various good news will likely be required to push stocks to new highs.

Core Inflation Rate Remains Unchanged At 1.7%

U.S. has just provided Inflation Rate and Core Inflation Rate reports. Inflation Rate increased by 1.4% year-over-year in September, in line with analyst consensus. Core Inflation Rate was 1.7% compared to analyst consensus of 1.8%.

The report did not show additional inflationary pressure. The Fed has promised to avoid raising rates for some time in case inflation gets above the 2% mark, but prices are still far away from this level.

Inflation reports indicate that the U.S. economy needs additional stimulus to boost prices and support economic growth.

For a look at all of today’s economic events, check out our economic calendar.