The Dow Jones Industrial Average opened higher on Friday but reversed lower shortly after the open. The Nasdaq composite and S&P 500 also reversed after early upside gains. Investors digested earnings from major financial firms JPMorgan Chase, Morgan Stanley and Citigroup.
Dow Jones, Nasdaq Open Higher
The Dow was about 0.8% lower. Meanwhile, the S&P 500 was down 1.7% as losses worsened. The tech-heavy Nasdaq lost 2.2% while the Russell 2000 declined 1.4%.
Volume was lower on the NYSE and on the Nasdaq, compared to the same time on Thursday.
Crude oil traded at $86.04 per barrel, down 3.5%. The yield on the benchmark 10-year Treasury rose to 4.02%.
September retail sales reported flat spending amid high inflation. Economists surveyed by Bloomberg had forecast a 0.2% gain. Excluding gasoline, retail sales rose 0.1%.
"An upturn in underlying retail sales in September and an upgrade to the prior month's pace suggest consumers are still kicking, even if total sales were flat," said Sal Guatieri, Senior Economist with BMO Capital Markets.
He noted that solid gains at clothing and department stores lifted the retail sales gauge by a solid 0.4%, adding "that's a decent advance considering that core consumer prices were unchanged in the month."
Dow Jones Stocks To Watch: JPMorgan Pops On Earnings
Dow Jones leader JPMorgan kicked off third-quarter earnings season with a 2.6% rally after beating top and bottom-line estimates. The firm says it will resume stock buybacks next year.
Earnings jumped 11% year over year to $3.12 per share while sales rose 31% to $32.72 billion, according to MarketSmith.
The stock has been trending lower for months but shares are now above their 21-day exponential moving average and fighting to regain their 50-day line.
Outside the Dow Jones, Wells Fargo also posted better-than-expected Q3 revenue, but profits missed expectations. The stock rose 3.8% in early trading as shares jumped above their 50-day moving average in heavy volume.
Morgan Stanley reported an earnings beat as well, posting a $1.53 per-share profit. But $12.99 billion in revenue missed expectations of $13.3 billion. Shares were down over 4% in early trading.
Finally, Citigroup beat earnings and revenue estimates but EPS dropped by 25%, due to weak investment banking activity. Shares still managed to gain 1.9% in early trading.
Stocks Breaking Out
A handful of stocks scored notable breakouts on Friday, including Molina Healthcare. Health care names have been holding up well in recent weeks as several group components are showing impressive relative strength.
Molina Healthcare broke out above a 361.35 flat base entry in decent volume. Shares pulled back quickly after the breakout but are now less than 1% away from the entry. The stock's relative strength line has notched a new high on the weekly chart, according to MarketSmith.
Principal Financial Group also scored a breakout on Friday. Shares rose above a 79.90 double-bottom base but also pulled back from the entry.
Fellow insurance stock W.R. Berkley broke out above a 72.41 buy point from a consolidation. The relative strength line hit a new high while the stock surged in heavy volume on Friday.
