Weekly data: JP Morgan & BlackRock price review for the week ahead

The most important economic data for this week are:

Wednesday:

• US Inflation rate at 12:30 GMT where the consensus is for an increase of around 0.2% reaching 3.4% for the month of March. If this is broadly accurate then it might not influence a change in the stance of the Federal Reserve at their next meeting where the probability for now is that they will keep the rates stable. On the other hand, if there is any significant surprise change in the actual figure then it will respectively affect the dollar in the short term.
• Bank of Canada Interest rate decision at 13:45 GMT is expected to remain stable at 5%. In case of a surprise hike in the interest rates would support the loonie in the short term while in the unlikely event of a rate cut then it might create some turmoil for the currency.
• FOMC Minutes at 18:00 GMT where investors and traders will be paying close attention to any hints from the Federal Reserve in terms of future developments on the monetary policy. Currently, the possibilities of a rate cut have been pushed back to the July meeting according to the Fedwatch tool whereas any hawkish narratives might push the prospectus of a rate cut further back.

Thursday:

• Chinese inflation rate at 01:30 AM GMT. The market consensus is for a further decline in the figure going from 0.7% to 0.4% for the month of March.
• ECB Interest rate decision at 12:15 GMT. The market consensus is that the central bank of Europe will keep the rates stable at 4.5% at their meeting on the 11th. If there is a surprise rate hike then the Euro might find support against other major currencies while a cut might create some losses in the short term. Investors and traders are rather focused on the subsequent press conference following the release that will be focusing on getting possible insights on the monetary policy steps ahead.
• S Producers Price Index (PPI) at 12:30 GMT. Market participants are expecting the figure to come out at 0.3% over 0.6% of the previous reading. If this is confirmed then it could potentially hint to potential lower inflation figures in the coming months.

Friday:

• British GDP growth at 06:00 AM GMT. The market consensus is that the figure will decrease from 0.2% to 0.1% month over month. This might not have a major effect on the quid since it is for the month of February however it would provide some hints on the overall economic performance of the British economy.

JP Morgan Chase & Co, daily

Shares in JP Morgan Chase and Co (symbol ‘JPM’) had a rather aggressive bullish rally in the first quarter of 2024 and managed to gain around 17% in value. JPM is expected to release its earnings report for the quarter ending March 2024 on Friday 12 April, before the market opens. The consensus estimate for earnings per share is $4.22 compared to the result for the same quarter last year of $4.10.

‘ In four out of the last five quarters, the company is recording higher net income, and its expected to continue to do so given the aggressive bullish momentum in the first quarter of the year. On the other hand, as of 31/12/2023, the current ratio is at 91% indicating that any short-term turmoil could potentially have a significant impact on the operations of the company. From a dividend perspective, the yield is currently at 2.15% which is rather positive from the shareholders’ viewpoint making the share of the company somewhat more attractive.

On the technical side, the price has been trading in a steady bullish momentum for the majority of the first quarter and also reached a new all time high level of $199.13 on March 28, 2024. The Stochastic oscillator is near the extreme overbought level while the price is trading above all technical indicators potentially indicating a correction in the following sessions leading up to the earnings release. On the other hand, the 50-day moving average is trading well above the slower 100-day moving average validating the overall bullish trend in the market.

Wells Fargo & Company, daily

Wells Fargo & Company (symbol ‘WFC’) share price rose by around 16% in the first quarter of the year. The company is expected to report its earnings for the fiscal quarter ending March 2024 on Friday 12th of April before the market opens. The consensus EPS for the quarter is $1.09 compared to the result for the same quarter last year of $1.23.

The bank had an impressive year in terms of net income with the latest data as of 31/12/2023 showing a 9.84% increase year over year. On the other hand, the current ratio of the company stands at just shy of 90% indicating that there is no ability of short-term liabilities repayment with the current assets at hand. On a positive note the dividend yield is at 2.33% which is within the range of average yields of major banks in the USA.

From the technical analysis perspective, the price lost some steam in recent sessions and entered a trading range between $56 -$58 area which is still valid to the day of this report being written. The Bollinger bands have contracted validating the lower volatility in the market while the Stochastic oscillator is not recording any overbought or oversold levels hinting that the price can move in either direction in the near short term. The faster moving averages are trading above the slower 100-day moving average further validating the overall bullish momentum.

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