By Jesse Cohen
Investing.com - Wall Street's first-quarter earnings season kicked off this week, with banks taking center stage, as the Covid-19 pandemic continues to hammer the economy.
JPMorgan (NYSE:JPM), Bank of America (NYSE:BAC), Citigroup (NYSE:C), Wells Fargo (NYSE:WFC) and Goldman Sachs (NYSE:GS) all reported alarming plunges in their respective Q1 profit. The nation’s largest banks also increased their loan-loss reserves by billions of dollars amid expectations for a jump in defaults from customers in the coming months.
Looking ahead, next week marks the first busy week of the first-quarter earnings season, with many of the big-name U.S. technology stocks, such as Netflix (NASDAQ:NFLX), IBM (NYSE:IBM) and Intel (NASDAQ:INTC) set to report.
The week after that then sees high-profile companies such as Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Facebook (NASDAQ:FB), Advanced Micro Devices (NASDAQ:AMD), Tesla (NASDAQ:TSLA), Boeing (NYSE:BA), Caterpillar (NYSE:CAT), and McDonalds release their quarterly results.
We're bracing for one of the worst earnings seasons in recent history. Analysts expect Q1 S&P 500 earnings to have fallen 12.8%, according to IBES data from Refinitiv, as the pandemic brought much of the global economy to a screeching halt.
U.S. stocks have recovered from their March lows, boosted by a raft of U.S. monetary and fiscal stimulus.
The Federal Reserve has taken unprecedented actions to support the economy during the coronavirus crisis in recent weeks.
There have been rate cuts and a slew of credit and lending programs that could inject more than $6 trillion into the economy.
Congress has passed $2 trillion in rescue efforts but continues to squabble over how much more should be allocated and how it should be distributed.
The S&P 500 is still down about 18% from its Feb. 19 record closing high, as the path to an economic re-start and the effectiveness of gigantic stimulus packages around the world remain unclear.
In the United States, the hardest-hit nation, the coronavirus death toll topped 30,000 on Wednesday and set a record single-day increase for the second day running.
President Donald Trump said he would announce guidelines for reopening the economy on Thursday, however, state governors - especially on the East Coast - seem to be pushing for a cautious approach.
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