NEWS
Traders Seek Protection As Global Tensions Rise

Rate cut concerns, weaker-than-expected bank earnings, and heightened Middle East tensions pressured risk assets, with most closing down on the day (and week) as traders sought safe-havens. Let’s see what you missed. 👀

Today's issue covers banks failing to beat expectations, pet health giant Zoetis falling to fresh lows, and more from the day. 📰

Here's today's heat map:

0 of 11 sectors closed green. Utilities (-0.76%) led, & materials (-1.77%) lagged. 💔

U.S. crude oil jumped on reports that Israel is preparing for an attack by Iran this weekend, causing commodities to continue their upward trend. 🛢️

Coupang, which has been dubbed the “Amazon of South Korea” rose 12% and closed at more than 2-year highs after announcing a 58% increase to its membership fees. 🛒

Arista Networks shares plunged 9% after Rosenblatt double-downgraded the company, saying its artificial intelligence (AI) opportunity may be smaller than initially anticipated. 👎

Electric vehicle stocks remained under pressure even as some U.S. lawmakers urged Biden to ban China-made EVs, saying they pose an existential threat to the American auto industry.🪫

Meanwhile, AMD and Intel shares fell on reports that China is continuing its crackdown on foreign chips, telling telecom makers to remove foreign chips by 2027. 🚫

Trump Media and Technology stemmed losses to close marginally positive on the day after Donald Trump urged his followers to support his social media app “Truth Social.” 📱

Other active symbols: $GL (+20.18%), $AMC (-5.36%), $NIO (-7.85%), $INDO (+80.29%), $TPET (+123.28%), & $DOGE.X (-10.90%). 🔥

Here are the closing prices: 

EARNINGS
Banking Boom Turns Bleak (Sort Of…)

Banks continue to deliver solid results in the current rate environment, but this time, it wasn’t enough to satisfy investors. 🙃

No bank sums up this situation better than JPMorgan Chase itself and its post-earnings action.

The nation’s largest bank saw profits rise 6% YoY to $4.44 in earnings per share, topping the $4.11 Wall Street expected. Revenues of $42.55 billion were also about 1% more than anticipated. 🤑

Net interest income continues to be the largest driver of performance for the consumer and commercial banking giant, with higher interest rates and a stable deposit base helping it churn out profits.

However, its guidance for future quarters left investors wanting more.⚠️

In 2024, executives expect about $90 billion in net interest income, which is flat YoY compared to a $2 to $3 billion increase that analysts expected.

Other key metrics were strong, with a $1.88 billion provision for credit losses coming in well below consensus estimates. But that was not enough to offset the conservative guidance on net interest income. ⚖️

It’s no surprise that Jamie Dimon and his bank are taking a conservative approach to their forecasts. He’s been vocal about the risks present in markets and the economy over the last year and still sees some potential issues on the horizon.

Overall, it was a pretty good quarter. But given how far JPMorgan shares and other financial stocks have run since October, it’s clear the market needs more on the fundamental side of things to justify further gains.

We saw similar action in others that reported today, though JPMorgan’s was the most pronounced. Shares broke their clean uptrend and fell 6% on the day. Still, the Stocktwits community is “extremely bullish” on the bank and is likely looking to buy the dip. 🐂

With banks kicking off earnings season in this light, the question now is, will the market treat “good news” with the same negative reaction in other sectors and industry groups? 🤔

We’ll certainly find out next week as more earnings reports roll in. 📝

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COMPANY NEWS
Pets Really Matter To People & Investors

Pets are a critical part of people’s lives (and families), which means they’re willing to spend a lot of money to keep their furry friends healthy and happy.

That booming business has allowed global animal health giant Zoetis to flourish after spinning off from Pfizer about a decade ago. 💰

With that said the company’s stock price surged during the COVID-19 pandemic but has struggled to maintain its upward trajectory in a slower-growth environment.

And for investors holding on for the long term, the turbulence continued today after a media report suggested the company’s arthritis shots could have sickened dogs and cats. ⚠️

That sent $ZTS shares down 8% to one-year lows, with the market speculating just how big of a problem this might be. 😨

We’ll have to wait and see how the story develops, but the Stocktwits community is sticking by the stock with sentiment still in “extremely bullish” territory as we end the week.

Speaking of pets, if you need more evidence of what people are willing to spend on them, look no further than the world’s first doggy jet service, which just launched and costs $6,000 for a one-way ticket.

Talk about flying in style…😮

Bullets From The Day

📉 Jamie Dimon, CEO of JPMorgan Chase, has expressed concerns about the significant decrease in the number of publicly traded companies in the United States. Dimon says the drop from 7,300 in 1996 to about 4,300 today is due to private equity firms. He argues that this leads to less transparency and investor confidence due to fewer companies adhering to the rigorous disclosure required of publicly listed companies. CNN has more.

🛢️ U.S. energy firms have reduced the number of operating oil and gas rigs for the fourth consecutive week. It’s the first such streak since September 2023, with the total count dropping to its lowest since November at 617. Despite a 20% increase in U.S. oil futures this year, natural gas prices have dropped significantly, leading to cuts in U.S. gas output and forecasts predicting a slight decrease in production from 103.8 billion cubic feet per day in 2023 to 103.6 billion in 2024. More from MarketScreener.

💼 BlackRock CEO Larry Fink has vocally defended his firm against what he describes as continuous lies by political critics, particularly highlighting the misinformation surrounding the firm's investment strategies. Amidst accusations of "woke investing," Fink emphasized that BlackRock's growth in U.S. investments, including $1.9 trillion in net inflows over five years, demonstrates the firm's success and alignment with client interests despite political challenges. Yahoo Finance has more.

Links That Don’t Suck

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⚠️ Ford’s hands-free BlueCruise comes under scrutiny after fatal crash

😡 Climate group sparks internal furor by opening door to carbon offsets

💾 Roku says 576,000 streaming accounts compromised in security breach

💊 Drug shortages hit record-high with hundreds in short supply: Pharmacists

🏦 Ben Bernanke urges the Bank of England to rethink its approach after recent inflation forecasting flops

*3rd Party Ad. Not an offer or recommendation by Stocktwits. See disclosure here.

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