Wall Street ends up for the 7th session in a row

The New York Stock Exchange continued its positive momentum on Tuesday, closing higher for its seventh straight session after better than expected bank results.

The Dow Jones index gained 1.06% to 34,951.93 points.

The tech-heavy Nasdaq and the broader S&P 500 index hit their highest level since April 2022, rising 0.76% to 14,353.64 points and 0.71% to 4,554.98 points respectively.

“The theme of the day for the banks was: + better than feared +”, summarized Steve Sosnick, analyst at Interactive Brookers, while investors digested the quarterly results of Bank of America and Morgan Stanley in particular.

“Unless there is really a very disappointing element” in the announcements, “everything is taken as good news”, he added, describing “a rising market trend”.

“It repeats itself almost every day, pre-open trading is down, then the buying kicks in” and the indices end in the green, he noted.

Bank of America, the second largest bank in the United States by size of assets, again benefited from interest rate hikes in the second quarter.

It recorded an 11% jump in its turnover, to 25.2 billion dollars. Net profit was $7.4 billion, up 19%. Adjusted per share, it stands at $0.88.

The bank’s stock gained 4.49%.

Morgan Stanley was also highly sought after (+6.44%), despite declining net profit. It fell 14% to $2 billion in the second quarter. The investment bank suffered from a “difficult” quarter in its advisory activities such as the IPO or mergers.

Its turnover nevertheless increased by 2% over one year to 13.46 billion dollars, marked by a record in the wealth management branch. Its new assets deposited by clients reached $90 billion.

Broker Charles Schwab jumped 12.52%, although its profit and revenue fell as analysts expected even worse results. In particular, Schwab indicated that the leak of deposits had slowed down.

For Steve Sosnick, “the bull market is widening” and no longer focuses only on high-tech stocks, even if Microsoft was again the star of the session on Tuesday, its stock market capitalization reaching a new peak. Its action soared by almost 4%.

The software giant has announced the launch of its artificial intelligence (AI) aided search engine reserved for subscription-based companies (Bing Chat Enterprise).

Beyond banks, the energy sector ended up sharply (+0.98%) in the wake of a jump in oil prices.

The defense group Lockheed Martin lost 2.90%, despite results and prospects supported by a context of continued demand for armaments in the world.

From April to June, the company achieved a turnover of 16.7 billion dollars (+8% over one year), more than market expectations. Its profit rose from $309 million a year ago to $1.68 billion.

Bond yields on ten-year Treasury bills fell to 3.78% from 3.80%.

Earlier before the opening of the market, the US Department of Commerce indicated that retail sales in the United States had continued to grow in June, but at a slower pace, at +0.2% against +0.5% expected.

“This retail sales report is mixed, but overall it paints a picture of a resilient US consumer,” said Edward Moya, analyst at Oanda.

As for industrial production, it fell in June for the second consecutive month (-0.5%).

Before the publication of its results on Wednesday, the airline United Airlines climbed 2.74%, other companies also having the wind in their sails such as American Airlines (+2.75%) and Delta Airlines (+3.37%).

Also on the earnings program on Wednesday, Netflix soared 5.50%, while Tesla, which has been rising steadily since Thursday, gained another 1%.

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