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From Wall Street to Main Street
Highlights from the past week

Market / Macro Economic Summary

Markets had a tough week as CPI data came in one tenth higher than expected on
Wednesday thereby pushing delays for the expected rate reductions to take
place. Then, the Producer Price Index (PPI) came in tamer than expected lifting
stocks. Friday, though, brought a more negative day as tensions in the Middle
East and bank earnings left a little to be desired. The S&P 500 fell 1.6%,
the Nasdaq .5% and the Dow Jones 2.4% for the week. I will say that while this
volatility might not be liked by most, I do think it’s good sign for the
markets. Markets shouldn’t just go up all of the time; there should be
instances where it trades sideways for a bit to adjust, then it can go higher.
I think this is what we’re in the middle of now.

Company Specific / Macro Economic Summary

JP Morgan Chase (JPM)
Shares dropped 6% as the bank delivered a good quarter, but comments from CEO
Jamie Dimon put a cloud on the coming months. Earnings per share of $4.44 were
much better than the expectations for $4.11 on the back of the increase
attributed to the First Republic Bank merger. Revenue also came in above
estimates as the $42.55 billion were also higher than the $41.85 billion
analysts were looking for. The main culprit for the decline was that, despite
the beats, the bank did not increase its yearly guidance for 2024 for net
interest margin from the previous guide of $90 billion.

Delta (DAL)
Shares fell 2% as the company reported a mixed quarter. Earnings came in at
$380 million, or 45 cents a share, up from $217 million, up 75% from a year
earlier. It easily topped Wall Street analysts’ consensus forecast of 36 cents
a share. Revenue, however, came in at $12.56 billion versus the estimates of
$12.59 billion. CEO Ed Bastain said leisure and business travel remain strong
as the peak season for travel comes in the coming months.

Citigroup Inc ( C )
Shares fell 2% on a day when most of the market was lower and ignored the
bank’s top and bottom-line beat. Earnings per share of $1.86 came in better
than the expectations of $1.23. Revenue of $21.10 billion also beat the calls
for $20.4 billion for the quarter. CEO Jane Fraser said the next quarter would
see an end to the corporate restructuring and get back to the business of
focusing on growth.

Wells Fargo (WFC)
Shares fell 2.5% as the bank reported a top and bottom-line beat. Earnings per share of $1.26 came in higher than Wall Street calls for $1.11. Revenue of $20.86 billion came in above the calls for $20.20 billion. Net interest margin did decrease 8% as the bank saw customers moving deposits towards higher yielding accounts like CD’s and other deposits.

Parting Thoughts

We welcome an opportunity to discuss the above detail and wish you much success in the rest of your week!

Erick J. Palacios, MBA