Stock market news today: US futures slide as bank earnings fail to thrill

US stock futures tumbled on Friday as a stream of big bank results failed to lift hopes that the quarterly earnings season can lift stocks out of their January malaise.

Dow Jones Industrial Average (^DJI) futures sank roughly 0.4%, while S&P 500 (^GSPC) futures were down 0.3%. Contracts on the tech-heavy Nasdaq 100 (^NDX) fell almost 0.4%.

Wall Street lenders kicked off fourth-quarter earnings, seen as a crucial chance for stocks to shake off the losses built in the year so far. JPMorgan Chase (JPM), Bank of America (BAC), and Wells Fargo (WFC) all posted decent results on Friday. But the latter two saw shares fall as they failed to settle nerves about potential pain ahead.

Also in focus, oil prices jumped over 3% after the US and its allies launched airstrikes against Houthi rebels in Yemen, drawing threats of reprisals from the Iran-backed group behind Red Sea attacks on shipping. Brent futures (BZ=F) traded above $80 a barrel, while West Texas Intermediate futures (CL=F) were just under $75.

Meanwhile, investors are watching for producer inflation data due out Friday morning, looking for more insight into price pressures after the consumer CPI reading came in hotter than expected on Thursday. That surprise print raised new questions about whether the Federal Reserve will cut interest rates in the next few months.

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  • Jamie Dimon again warns on ‘stickier’ inflation, higher interest rates

    JPMorgan (JPM) reported fourth quarter results early Friday that capped a record year for the country’s largest bank.

    And inside the firm’s fourth quarter release, investors got another expansive view on the US and global economy from its outspoken CEO, Jamie Dimon.

    Largely reiterating his view that investors are too complacent with the idea inflation is on a smooth path back to the Federal Reserve’s 2% target and interest rates will remain higher than forecasters expect, Dimon said a host of “unprecedented” factors in markets means the bank “must be prepared for any environment.”

    Here are Dimon’s comments in full, with our emphasis and spacing added:

    The U.S. economy continues to be resilient, with consumers still spending, and markets currently expect a soft landing. It is important to note that the economy is being fueled by large amounts of government deficit spending and past stimulus.

    There is also an ongoing need for increased spending due to the green economy, the restructuring of global supply chains, higher military spending and rising healthcare costs. This may lead inflation to be stickier and rates to be higher than markets expect. On top of this, there are a number of downside risks to watch.

    Quantitative tightening is draining over $900 billion of liquidity from the system annually, and we have never seen a full cycle of tightening. And the ongoing wars in Ukraine and the Middle East have the potential to disrupt energy and food markets, migration, and military and economic relationships, in addition to their dreadful human cost. These significant and somewhat unprecedented forces cause us to remain cautious. While we hope for the best, the past year demonstrated why we must be prepared for any environment.

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