US STOCKS-Wall Street set for subdued open after mixed bank reports

First Word: 11 July 2019
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US STOCKS-Wall Street set for subdued open after mixed bank reports

* J.B. Hunt jumps after strong DCS performance

* JPM, Wells Fargo drop after results

* Goldman Sachs rises after profit beat

* June retail sales better than expected

* Futures up: Dow 0.10%, S&P 0.07%, Nasdaq 0.05% (Adds comment, details; Updates prices)

By Medha Singh

July 16 (Reuters) – U.S. stock indexes were set for a muted open on Tuesday after a set of mixed quarterly reports from Wall Street banks JPMorgan Chase, Goldman Sachs and Wells Fargo.

JPMorgan, the largest U.S. bank by assets, beat profit estimates but interest margin, a key measure of profitability, slipped, triggering concerns of lower interest rates hurting bank profits, a day after Citigroup Inc reported a similar drop.

JPM shares were down 1.4% premarket. Goldman Sachs gained 1.2% after quarterly profit topped estimates. Wells Fargo also reported better-than-expected profit, but its shares fell 0.8%.

“We’re probably in for a grindingly positive session,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

“We’re going to need extraordinarily good news in order to keep the market rallying at a fast pace. It will be really difficult to do that until we get into the full earnings season.”

Leading the gainers among the S&P 500 companies was shares of J.B. Hunt Transport Services Inc, which jumped 7.6% after the transport and logistics provider posted strong quarterly performance in its second biggest unit DCS, which provides final-mile delivery.

Dow Industrials member Johnson & Johnson hiked its full-year operational sales forecast as strong demand for its cancer drugs Darzalex and Imbruvica. Its shares were trading flat.

As earnings season kicks off in earnest this week, trade war remains a focus for investors as they look to determine how deeply it would hurt the profits and forecasts of companies.

Profit at S&P 500 companies is likely to dip 0.3%, which would be the first quarterly drop in three years, according to Refinitiv IBES data.

At 8:49 a.m. ET, Dow e-minis were up 28 points, or 0.1%. S&P 500 e-minis were up 2.25 points, or 0.07% and Nasdaq 100 e-minis were up 4.25 points, or 0.05%.

Wall Street’s three main indexes have scaled fresh record highs this month on increasing hopes the Federal Reserve would lower interest rate at its policy meeting, which is two weeks away, to cushion the economy from any slowdown due to trade tensions.

A Commerce Department report showed retail sales increased more than expected in June, but would probably have little impact on market expectations of a rate cut.

“It’s important that we get macro news that suggests we’re not heading towards a recession due to the trade war,” Cardillo said.

Investors also awaited the U.S. Federal Reserve’s industrial production data, which is expected to have edged 0.1% higher in June compared to 0.4% rise in May. The data is expected at 9:15 a.m. ET. (Reporting by Medha Singh and Uday Sampath in Bengaluru; Editing by Arun Koyyur)