US STOCKS-S&P 500 eases from record on tech retreat, Wells Fargo slide

Published 14/01/2020, 17:51
Updated 14/01/2020, 17:55
© Reuters.  US STOCKS-S&P 500 eases from record on tech retreat, Wells Fargo slide

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* JPMorgan, Citi rise on fourth-quarter profit beat

* Wells Fargo slides as legal costs hit earnings

* Delta Air Lines gains on profit beat; peers rise

* Indexes: Dow up 0.34%, S&P off 0.08%, Nasdaq down 0.17%

(Changes comment, updates prices)

By Sruthi Shankar

Jan 14 (Reuters) - The S&P 500 eased from record levels on

Tuesday, as technology stocks handed back gains made on hopes of

a preliminary U.S.-China trade deal and Wells Fargo slid in a

mixed start to big banks' quarterly earnings.

Kicking off the fourth-quarter earnings season, the largest

U.S. bank, JPMorgan Chase & Co JPM.N , rose 2.3% after

reporting a better-than-expected profit on strength in its

trading and underwriting businesses, keeping the blue-chip Dow

index in the positive territory. Wells Fargo & Co WFC.N dropped 3.7% after reporting a

slump in profit, as it set aside $1.5 billion toward legal

expenses, while Citigroup Inc C.N rose 2.3% as it topped Wall

Street profit estimates. The S&P 500 banks index .SPXBK was up 0.9%.

Technology and internet stocks that took the main indexes to

record highs on Monday - Amazon.com Inc AMZN.O , Apple Inc

AAPL.O , Nvidia Corp NVDA.O and Facebook Inc FB.O - shed

between 0.4% and 1%.

Analysts expect profits at S&P 500 companies to drop 0.5%

for the second consecutive quarter, according to Refinitiv IBES

data, largely due to a drag in energy and industrial earnings

that have been hit by a prolonged trade war.

China has pledged to buy nearly an additional $80 billion of

manufactured goods from the United States over the next two

years, and over $50 billion more in energy supplies, Reuters

reported, citing a source briefed on the trade deal that is

expected to be signed on Wednesday. "Market and company reactions to this deal, even if it works

out imperfectly and ultimately with a smaller magnitude or a

slower actual adjustment to stated goals, will still be largely

positive," said Jim Paulsen, chief investment strategist at

Leuthold Group in Minneapolis.

"Just having China and the U.S. talking and changing

behaviors will likely be perceived as a huge step toward a

greater future."

At 11:19 a.m. ET, the Dow Jones Industrial Average .DJI

was up 97.77 points, or 0.34%, at 29,004.82, the S&P 500 .SPX

was down 2.55 points, or 0.08%, at 3,285.58 and the Nasdaq

Composite .IXIC was down 15.43 points, or 0.17%, at 9,258.50.

Delta Air Lines Inc DAL.N rose 3.9% after reporting a

better-than-expected quarterly profit, boosted by customers

gained from rival airlines' 737 MAX cancellations. The S&P 1500

airlines index .SPCOMAIR rose 2.3%. Advancing issues outnumbered decliners by a 1.16-to-1 ratio

on the NYSE and a 1.08-to-1 ratio on the Nasdaq.

The S&P index recorded 48 new 52-week highs and no new lows,

while the Nasdaq recorded 108 new highs and 21 new lows.

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