U.S. Stocks Advance Ahead of Busy Week of Earnings, Goldman Sachs and Bank of America Rise

Barry Adams
18 Jul, 2022
New York City

Stocks on Wall Street advanced and Bank of America and Goldman Sachs reported better than expected earnings. 

The S&P 500 index increased 0.8% to 3,896.20 and the S&P 500 index advanced 1.2% to 11,589.56. 

Futures of crude oil prices increased $4.23 to $101.86 and natural gas advanced 39 cents to $7.39 a unit. 

The yield on 10-year U.S. Treasury notes increased to 2.98%.  

Goldman Sachs gained 4.2% to $306.19 after the financial services company said a surge in bond trading revenues helped to offset the weakness in investment banking revenues in the latest quarter ending in June. 

Bank of America increased 1.1% to $32.64 after the lender benefited from the rising rate environment. 

Revenues, net of interest expenses, increased 6% to $22.7 billion and net income declined to $5.9 billion or 73 cents a diluted share from $8.9 billion or $1.03 a diluted share. 

The bank also took a charge of $523 million for the provision of credit losses. 

Investors are also awaiting earnings this week from 135 companies including Tesla, Netflix, United Airlines, Union Pacific, Johnson & Johnson, and Verizon.  

IBM is scheduled to report earnings after the regular hours trading today. 

Boeing Co increased 4.5% to $154.60 after Delta Airlines placed an order for 100 737 MAX 10 jets. 

 

European Markets Rally 

European markets advanced following the optimism in New York and on the hopes that natural gas will start flowing again through Nord Stream 1 pipeline network this week. 

European investors are also looking ahead at the European Central Bank's policy meeting on July 21 and a rate hike of 25 basis points followed by a 50 basis points increase at its September meeting. 

The DAX index increased 0.7% to 12,962.08, the CAC-40 index added 0.9% to 6,90.20, and the FTSE 100 index advanced 0.98% to 7,228.69. 

The euro edged up to trade at $1.015. 

Investors also looked ahead to the Italian Prime Minister Mario Draghi's address to the parliament this Wednesday. 

H & M Hennes & Mauritz AB declined 0.5% to skr 125.60 and the Swedish apparel retailer said it has stopped its retail selling in Russia since March and has started the process of winding down its operation in the country. 

GSK Plc declined 3.3% to 1,386.60 after the British pharmaceutical maker completed the spinoff of its $36 billion consumer healthcare business. 

Stellantis NV declined 0.3% to 12.0 euros after the Italian automotive group said it will end its joint venture with a company that makes and sells the Jeep brand in China. 

  

Asian Markets Advance 

Markets across Asia closed higher after Chinese regulators urged the central bank to provide financial support to real estate developers. 

Mortgage boycotts are spreading in China and home buyers in 12 cities are protesting and suspending monthly payments as unfinished residential real estate projects pile. 

About 5 million home buyers with more than $40 billion mortgages have suspended payments according to local media reports in China. 

As many as one third of recently sold residential units are facing extended delays or lack of progress on construction sites. 

China's economy is struggling after two months of severe lockdowns and the continued restrictions in social gathering for more than 250 million people in at least 20 cities. 

Shanghai and Tianjin ordered mass Covid-19 testing following its zero-Covid-19 policy. 

The fresh outbreak of infections highlights the risks of new lockdowns and slows the economic rebound in the second largest economy of the world. 

The Hang Seng Index soared 2.7% to 20,846.18, the Sensex index gained 1.4% to 54,521.15, and the the Kospi average climbed 1.90% to close at 2,375.25

Markets in Tokyo were closed for a holiday.