Futures rise after strong bank earnings; key inflation data awaited

By Johann M Cherian and Sukriti Gupta

(Reuters) -Strong quarterly results from Wall Street's biggest banks pushed U.S. stock index futures higher on Wednesday as investors awaited a crucial inflation report due later in the day.

At 06:50 a.m. ET, Dow E-minis were up 160 points, or 0.37%, S&P 500 E-minis were up 19.25 points, or 0.33% and Nasdaq 100 E-minis were up 81.75 points, or 0.39%.

JPMorgan Chase & Co (NYSE:JPM ) rose 2.7% in premarket trading after the lending giant's profit rose as its dealmakers and traders reaped a windfall from rebounding markets in the fourth quarter.

Wells Fargo (NYSE:WFC ) added 3.1% after the fourth-largest U.S. lender's profit climbed in the fourth quarter, buoyed by stronger investment banking earnings.

Shares of Citigroup (NYSE:C ) and Goldman Sachs (N:GS ) advanced about 1% each ahead of their respective quarterly reports, due before markets open.

"It is very optimistic to look into 2025 with the new (Trump) administration, because there will be less regulatory activity and even with higher interest rates, the net interest margins of banks will probably improve," said Peter Andersen, founder of Andersen Capital Management.

The S&P 500 Banks Index has gained about 3% in January, outperforming Wall Street's main indexes, which have logged declines so far this month.

In 2024, the banking index logged its biggest annual jump since 2019, on expectations that U.S. President-elect Donald Trump's policies such as tax cuts and loose regulations could boost the financial sector.

Following a more than two-year bull rally, the S&P 500 is trading at valuations well above its historical long-term average and a disappointing earnings season could jeopardize further gains for equities.

Also on the radar is the consumer price index, due at 8:30 a.m. ET. Economists polled by Reuters expect the figure to rise 2.9% in December, from the previous month's 2.7% advance. Excluding volatile items such as food and energy, the index is expected to increase 3.3%.

Signs of strong economic activity and expectations that Trump's immigration and tariff policies could further stoke price pressures have caused markets to pare back bets on the U.S. Federal Reserve's pace of monetary policy easing this year.

Traders see the central bank delivering a total of 31.1 basis points worth of rate cuts this year, according to data compiled by LSEG. The central bank is slated to unveil its beige book on economic activity at 2:00 p.m. ET, which is expected to throw further light on the economy's health.

Adding to investor unease, yields on longer-dated Treasury bonds remained near more than one-year highs. [US/]

Remarks from New York Fed President John Williams and Chicago Fed President Austan Goolsbee, both Federal Open Market Committee voting members, will also be parsed later in the day.



Among stocks, BlackRock (NYSE:BLK ) rose 3.2% after the world's largest money manager's assets hit a record high of $11.6 trillion in the fourth quarter of 2024 and posted a 21% profit jump.

BNY also reported a jump in its fourth-quarter profit, sending its shares up 1.7%.

Source: Investing.com