US Stock Index Futures Lower after Goldman Sachs Profit Plunge; Morgan Stanley Beat

Stock futures are lower Tuesday following the release of mixed earnings reports from bank giants Goldman Sachs and Morgan Stanley.

Goldman Sachs Misses Profit Estimates

Goldman Sachs posted fourth-quarter results on Tuesday that missed analysts’ estimates for profit amid steep declines in investment banking and asset management revenue.

The company reported earnings of $3.32 per share versus a $5.48 estimate of analysts surveyed by Refinitiv. Revenue came in at $10.59 billion versus a $10.83 billion forecast.

Shares of Goldman Sachs are trading at $367.50 in the premarket session, down $6.50 or -1.74%.

Morgan Stanley’s Earnings Top Wall Street Expectations

Morgan Stanley reported fourth-quarter earnings on Tuesday that exceeded Wall Street Expectations, boosted by the bank’s record revenues from wealth management.

According to the report, the bank’s wealth management reported record net revenues of $24.4 billion, compared with $24.2 billion in the prior year. The result was helped by an increase in net interest income on higher interest rates and bank lending growth, the bank said.

Shares are trading $92.38 in the premarket session, up $0.80 or +0.87%.

Major Banks Report Mixed Results

Last week, JPMorgan Chase and Bank of America topped profit expectations on surging net interest income, while Wells Fargo and Citigroup posted mixed results.

Broad-Based Decline Ahead of the Bell

Despite the mixed results from Goldman Sachs and Morgan Stanley, investors are erring on the side of caution and taking the major stock lower ahead of the opening bell.

Goldman Sachs is a component of the Dow Jones Industrial Average so it is having a strong negative influence on the blue chip average.

Morgan Stanley and Goldman Sachs are both components of the S&P 500 Financials sector. Based on their premarket performances, investors are looking for weakness in the sector and the benchmark index.