Stocks closed in negative territory Thursday in lighter volume ahead of the three-day Easter weekend, as three big U.S. banks kicked off the quarterly reporting season and the U.S. launched a bomb in Afghanistan.
The S&P 500 fell 0.68%, the Dow Jones Industrial Average fell 0.67% and the Nasdaq declined 0.53%. Stocks had opened the session lower and moved into positive territory for a short time. All sectors were lower Thursday with energy and financial shares leading the decliners. Of note, Chevron(CVX) - Get Report was down 2.61% pulling the Dow lower.
This comes as the U.S. Air Force dropped the largest non-nuclear bomb targeting ISIS in Afghanistan, according to the Associated Press.
Crude settled up 0.1% to $53.18 a barrel, following declines the previous day after the Energy Information Administration's weekly status report showed that U.S. crude oil inventories declined by 2.2 million barrels last week, and OPEC said in its monthly oil report that production decreased by 153,000 barrels a day.
The number of oil and natural gas drilling rigs in the U.S. rose by eight week over week, Houston oilfield services provider Baker Hughes reported Thursday.
JPMorgan Chase(JPM) - Get Reportreported first-quarter earnings of $1.65 a share on revenue of $25.59 billion, beating analysts' expectations. A year earlier, the bank earned $1.35 a share on revenue of $24.08.
Shares of JPMorgan closed down 1.16% after being up over 1% earlier in the day.
Citigroup(C) - Get Report earned $1.35 a share in the first quarter, topping forecasts of $1.23. The stock fell 0.80%. Wells Fargo(WFC) - Get Reportearned $1 a share in the first quarter, beating estimates by 4 cents. Shares fell 3.3%.
"JPMorgan Chase's results show positive momentum for investment banking and capital markets earnings on back of solid debt and equity underwriting and strong fixed income trading revenues," Ana Arsov, Moody's Investors Service associate managing director, wrote in a note. "This may indicate a return back to the banks usual positive Q1 cyclicality. However, the direction of tides is unclear on a variety of economic, geopolitical and policy issues on the horizon."
"Financials should report the highest growth in earnings of all sectors, at 14.3%, on rising interest rates and capital markets," Brad McMillan, Commonwealth Financial Network's chief investment officer, wrote in a note. "Accelerating earnings growth is a very positive trend."
FactSet estimates that earnings will grow at 8.9% in the first quarter, which would be the "fastest growth in earnings on a year-on-year basis since the end of 2013, and well above what we have seen in the past two quarters," McMillan said.
Consumer sentiment in the U.S. for April rose to 98 from 96.9 in the previous month, according to the University of Michigan.
Donald Trump, in an interview with The Wall Street Journal Wednesday, said the dollar was getting "too strong" and that he wouldn't declare China a currency manipulator. The dollar dropped shortly after Trump's comments were published but has since stabilized. Trump blamed the strong dollar on himself, saying it's his fault "because people have confidence in me."
The U.S. Dollar Index rebounded to trade up 0.36% to 100.54 on Thursday.
United Airlines(UAL) - Get Report shares fell Thursday after the attorney for the passenger who was violently dragged off a United plane for not voluntarily giving up his seat said there may be a lawsuit against the airline.
United said it would offer compensation to all passengers on the flight where a passenger was violently dragged off a United plane for not voluntarily giving up his seat. United shares dropped 0.6%.
Berkshire Hathaway (BRK.A) - Get Reportreduced its holdings in Wells Fargo, the company said Wednesday in a regulatory filing. Warren Buffett's company said it sold more than 7 million shares of the bank, which kept its ownership stake below 10%. The company said "in the near future" it would sell another 1.87 million shares. Shares of Berkshire fell 0.96%.
Yext (YEXT) - Get Report, a New York tech startup focusing on data management, had its trading debut Thursday. The initial public offering was priced at $11 a share. The stock closed up 20.8% to $13.29.
Weekly U.S. jobless claims were 234,000, slightly lower than the previous week. Meanwhile, the Bureau of Labor Statistics's producer price index for March declined 0.1% from the prior month, but wholesale inflation has increased 2.3% from the prior year. This is the first time in seven months that prices received by domestic producers of goods and services declined.
Markets will be closed Friday.