Wall Street was roughly flat in early trading as bank quarterly earnings and new inflation data pulled markets in different directions.
S&P 500 futures were unchanged before the close of trading on Friday, while Dow Jones Industrial Average futures were up less than 0.1%.
Shares of major U.S. banks were mixed, even as most reported healthy profits that beat Wall Street expectations.
The stock rebounded after JPMorgan sold off billions of dollars of its stake in Visa Inc. and the bank reported a 25% increase in profits from a year ago, but the stock only saw modest gains.
Wells Fargo’s results worsened even as its profit and revenue beat Wall Street expectations. Shares fell nearly 6% after the bank said its net interest income fell 9% from a year ago. The San Francisco bank said it doesn’t expect that figure to improve for the rest of its fiscal year.
Friday’s report showed wholesale prices rose, a day after the government reported that consumer price inflation eased in June, suggesting price pressures remain high.
Thursday Inflation Report There is growing speculation on Wall Street that a rate cut could come as early as September.
Bond yields were flat early Friday after falling the previous day as traders grew more bet the Federal Reserve will soon start cutting its key interest rate. Yields have been hovering at their highest levels in more than two decades for nearly a year. The yield on the two-year Treasury note closed at 4.51% early Friday, while the 10-year note was at 4.21%.
Wall Street wants to cut interest rates to ease pressures that have built up in the economy as it has become so expensive to borrow on credit cards to buy homes, cars and everything else, but Fed officials have said they want to see “better data” on inflation before acting.
Wall Street took that as precisely what a report on Thursday showed that prices for gasoline, cars and other goods bought by U.S. consumers rose more slowly than expected in June from a year earlier.
Meanwhile, European markets were up as of midday, with Germany’s DAX up 0.3% and Paris’ CAC 40 up 0.7%, while London’s FTSE 100 rose 0.2%.
In Asia, Tokyo’s Nikkei stock average fell 2.5 percent to 41,190.68.
Hong Kong’s Hang Seng Index rose 2.6% to 18,293.38 and the Shanghai Composite Index was little changed at 2,971.29 after data showed China’s exports rose 8.6% in June, beating market expectations.
Australia’s S&P/ASX 200 rose 0.9% to 7,959.30. South Korea’s KOSPI fell 1.2% to 2,857.00.
Meanwhile, Bangkok’s SET rose 0.1%, while Taiwan’s Taiex fell 2% and Taiwan Semiconductor fell 3.7%, following Wall Street’s tech giants down after the company rose after reporting a nearly 33% increase in June revenue from a year earlier.
Benchmark U.S. crude rose 78 cents to $83.40 a barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the international standard, rose 58 cents to $85.98 a barrel.
The dollar fell 2.1% against the yen overnight, dropping to as low as 157.43 yen, stoking speculation that Japanese authorities may have intervened to amplify the impact of easing U.S. inflation measures. The dollar recovered some of its losses on Friday, rising to 158.94 yen from 158.80 yen.
The euro rose to $1.0888 from $1.0865.
On Thursday, the S&P 500 fell 0.9% to 5,584.54, the Dow rose 0.1% to 39,753.75 and the Nasdaq Composite index lost 2% to 18,283.41.
