Listen below or on the go on Apple Podcasts and Spotify
Big banks Q2 earnings expected to show rebounding IB, soft loan growth. (00:21) Tesla (TSLA) falls 7% on reports that the robotaxi event is delayed until October. (01:36) Dollar General (DG) to pay $12M fine for workplace safety violations. (02:42)
This is an abridged transcript of the podcast.
The second-quarter earnings season shifts into higher gear today with some major banks releasing results, and shares of most of a group of big banks have outstripped the S&P 500’s (SP500) advance this year.
JPMorgan Chase (JPM) and Wells Fargo (WF) will be among those kicking off the parade of Q2 bank results. Broadly for banks, analysts say among the figures to watch are those for loan growth, which are likely to remain soft in the face of still-high interest rates. Meanwhile, investment banking (“IB”) fees are likely to benefit as activity starts to rebound.
But prospects for the Federal Reserve to begin lowering borrowing costs in 2024 has helped drive up the S&P 500 Banks index (SP500-401010) by 19% this year. Shares of five of six big banks, whose results are in Wall Street’s spotlight, have moved higher than the Banks index and the 17% advance in the S&P 500 (SP500)(SPY)(VOO) in 2024.
Here’s how shares of six major banks have performed YTD ahead of Q2 results:
-
Citigroup (C) – up 27.7%. Market cap: $127.8B
-
Goldman Sachs (GS) – up 24.2%. Market cap: $162.7B
-
Bank of America (BAC) – up 24%. Market cap: $326.4B
-
JPMorgan & Chase (JPM) – up 21.9%. Market cap: $596.7B
-
Wells Fargo (WFC) – up 21.3%. Market cap: $208.2B
-
Morgan Stanley (MS) – up 11%. Market cap: $168.1B
Tesla (NASDAQ:TSLA) closed lower on Thursday after Bloomberg reported that the company may be delaying its robotaxi event scheduled for August 8.
TSLA fell 8.4% on Thursday and is down 1% premarket.
Sources indicate that the event may not take place until October because it needs more time to build the autonomous vehicle prototypes.
CEO Elon Musk has been mentioning the robotaxi event since April, while the robotaxi concept has been part of Tesla’s (TSLA) Master Plan for at least eight years.
Tesla (TSLA) has not confirmed if the date of the robotaxi event has changed.
Last month, J.P. Morgan warned that consensus expectations and valuation demands around the robotaxi business imply it will be a home run, which it considers far from certain. Notably, the firm thinks the timeframe for any company to generate material revenue from robotaxi operations is years out. That plays into its view that investors in Tesla (TSLA) may have gotten ahead of themselves in terms of baking in a robotaxi premium.
Dollar General (NYSE:DG) has agreed to pay a $12M fine and improve safety conditions as part of a settlement with the U.S. Department of Labor.
The settlement is to resolve violations that included unsafe storage, blocked emergency exits and fire extinguishers, and inaccessible electrical panels.
The Tennessee-based company agreed to establish new safety protocols, hire more safety staff, and significantly reduce store inventory to avoid obstructed exits.
Dollar General (DG), which operates more than 19,000 stores nationwide, has also brought in a third-party consultant to identify hazards and perform unannounced compliance audits annually, the U.S. Department of Labor said.
If inspectors find similar issues, the discount retailer will have to pay $100,000 a day up to $500,000 if problems are not resolved within 48 hours.
More articles on Seeking Alpha:
SA subscribers pitch stocks that could potentially replace Tesla in Magnificent 7
PayPal may profit from Apple-EU settlement, analyst says
AI made up a third of all VC funding this quarter, U.S. companies taking the lead – DataTrek
Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the green. Crude oil is up 1% at $83 per barrel. Bitcoin is down 2.1% at $57,000.
In the world markets, the FTSE 100 is up 0.1% and the DAX is up 0.2%.
The biggest movers for the day premarket: Following Q2 results, Ericsson’s (NASDAQ:ERIC) is up 3.6% despite a 7% Y/Y dip in revenue, as the decline was smaller than expected, especially with strong growth in North America.
On today’s economic calendar:
Read the full article here