Stocks traded higher on Tuesday, Jan. 15, as Wall Street digested a weaker-than-expected fourth-quarter earnings report from JPMorgan Chase & Co. (JPM) .
The Dow rose 156 points, or 0.65%, to 24,066, the S&P 500 gained 1.07%, and the Nasdaq rose 1.7% as Netflix Inc. (NFLX) surged following a price hike at the streaming service.
Equities also got a lift from signals from China that suggested the prospect of further stimulus for the world's second-largest economy.
China's National Development and Reform Commission, a key government division, said it aimed to create a "good start" for the economy over the first few months of the year, raising hopes that planned stimulus, including tax cuts and liquidity support equal to around $220 billion, could be deployed in order to halt the slowest pace of growth in nearly a decade.
The partial shutdown of the U.S. government entered its 25th day on Tuesday, and a CNBC report said the Trump administration now estimates that the cost of the government shutdown will be twice as steep as originally forecast.
The original estimate that the partial shutdown would subtract 0.1 percentage point from growth every two weeks now has been doubled to a 0.1 percentage point subtraction every week, CNBC reported, citing an an official who asked not to be named.
JPMorgan Chase & Co. (JPM) reported fourth-quarter earnings of $1.98 a share, missing estimates of $2.20 by a wide margin. It was the bank's first profit miss in four years as trading revenue fell short of expectations and costs rose for loan-loss reserves.
Net income rose 67% to $7.07 billion, benefiting from the 2017 tax cuts and rebounding from a big write-down taken a year earlier.
Net revenue rose 7% from a year earlier to $26.1 billion, JPMorgan said, less than estimated, however, by analysts at the brokerage firm Keefe, Bruyette & Woods. Volatile markets in the fourth quarter took a toll on bond trading and commodities, partially offset by strength in emerging markets, the bank said.
Revenue in the bond-trading division fell 16% to $1.9 billion, a bigger drop than the 10% predicted by the KBW analysts. Stock-trading revenue rose 15% to $1.3 billion.
Shares of the bank were up 0.73% on Tuesday. JPMorgan Earnings Fall Shy of Estimates for First Time in Four Years Wells Fargo & Co. (WFC) reported fourth-quarter profit of $1.21 a share, beating forecasts by 2 cents. The bank said net income slipped by 1% to $6.06 billion as the scandal-plagued bank lumbered under regulatory sanctions imposed last year and as legal costs mounted to resolve complaints over alleged customer abuses. The stock was down 1.55%. Wells Fargo Profit Falls 1% as Scandal Costs Mount, Sanctions LingerUnitedHealth Group Inc. (UNH) posted stronger-than-expected fourth-quarter earnings and held its 2019 outlook in place, as Optum revenue topped $100 billion for the first time on record last year. UnitedHealth shares rose 3.55%.
Delta Air Lines Inc. (DAL) posted stronger-than-expected fourth-quarter profit but its guidance came in lower than Wall Street estimates. The stock rose slightly. The company expects earnings in its first quarter of 70 cents to 90 cents a share, below forecasts of 92 cents.
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Netflix jumped 6.5% after the streaming giant said it would be raising monthly prices in the U.S. by 13% to 18%, its biggest increase since it began streaming movies and videos 12 years ago. The last hike was in 2017.
Netflix Raising Prices by 13% to 18%, Its Largest Increase EverMicrosoft Corp. (MSFT) has teamed with Walgreens Boots Alliance Inc. (WBA) to '"develop new health care delivery models, technology and retail innovations to advance and improve the future of health care," the companies said in a statement.
Under the agreement, Microsoft will serve as Walgreens strategic cloud provider and the drugstore company will migrate most of its IT infrastructure onto Microsoft Azure.
Microsoft shares rose 2.9% Tuesday.
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