Wall Street On Track For Banner Year!

Wall Street On Track For Banner Year!

Wall Street On Track For Banner Year!

$DIA, $SPY, $QQQ, $RUTX, $VXX

  • Despite the persistence of geopolitical and economic risks, the backdrop is constructive
  • There are more catalysts in the market and more participation.

Wall Street trading desks’ revenue is on track for the best year since 2011, Q-2 earnings reports from big US banks revealed.

Trading revenue gains of up to 17% helped JPMorgan Chase & Co.(NYSE:JPM), Bank of America Corp.(NYSE:BAC), Goldman Sachs Group Inc. (NYSE:GS) and Morgan Stanley (NYSE:S) beat market expectations, and executives are cautiously optimistic about the trading environment.

Citigroup Inc.(NYSE:C) was the only major bank to report lower trading revenue, citing challenges in fixed income markets.

Those 5 Wall Street banks generated roughly $44-B in trading revenue during 1-H of this year, a 7-year high when adjusting for 1-time items, said a bank analyst with Autonomous Research.

“There’s been much more volatility,” he said. “It’s been in fits and starts, but the thesis is still that customers are going to be more active.”

Bank executives expressed some faith robust trading conditions will continue.

Escalating tensions between the United States and major trade partners, combined with the likelihood that the Fed will lift interest rates again in September, could encourage investors to protect their portfolios or seize opportunities, he said.

Executives at Goldman Sachs have expressed more confidence than those at other banks, including rival Morgan Stanley.

Wednesday, Morgan Stanley CFO Jon Pruzan warned conditions could deteriorate later in the year due to seasonal declines and international flare-ups.

“Trade tensions, political uncertainties across Europe and the potential for an inverted yield curve, to name a few, are factors that remain at play,” he said.

Many consider an inverted yield curve to be a sign of a looming economic slowdown. The US yield curve has flattened in recent months due to concerns over the global economy.  The Fed is not concerned.

Wednesday, the major US stock market indexes finished at: DJIA +79.40 at 25199.29, NAS Comp -0.67 at 7854.46, S&P 500 +6.07 at 2815.36

Volume: Trade on the NYSE came in at 710-M/shares exchanged

  • NAS Comp +13.8% YTD
  • Russell 2000 +10.2% YTD
  • S&P 500 +5.3% YTD
  • DJIA +1.9% YTD

HeffX-LTN’s US Major Stock Market Indexes Technical Analysis

Date Symbol Price Technical Analysis Support Resistance
18 July 2018 QQQ 179.93 Bullish (0.42) 179.35 185.49
18 July 2018 DIA 251.92 Neutral (0.24) 250.65 253.94
18 July 2018 SPY 281.06 Bullish (0.42) 279.77 286.58

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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