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JP Morgan Chase beats by $0.07, misses on revs

Published on January 15, 2009

JP Morgan Chase beats by $0.07, misses on revs

January 15, 2009

JP Morgan Chase (JPM) Reported Q4 (Dec) earnings of $0.07 per share, $0.07 better than the First Call consensus of ($0.00); revenues fell 0.9% year/year to $17.23 bln vs the $18.83 bln consensus. Losses were in investment banking due mark downs on leveraged loans and mortgage trading positions. They faced higher credit costs associated with continued deterioration across our loan portfolios, including a $4.1 billion addition to loan loss reserves. Let’s see how it filters to the financials today.

What a nasty day that it was. A worse-than-expected retail sales report brought the sellers into the market it sold off in a broad-based decline that saw all the major market indexes-big, mid and small cap—fall by 3-4%. Intense selling made it a 90% Down Day for both NYSE and NASDAQ. One of the worst hit sector was financials and Bank of America (BAC) closed very close to $10W, and Citi (C) fell again below $5.

Losses were heavy and across the board led by Coal -8.7%, Steel -8.3%, Casino -7.1%, Insurance -6%, Airline -5.9%, Computer-Hardware -5.7%, Networking -5.5%, Oil Service OIH -5.5%, Rail -5.4% (new 52-wk low), Housing XHB -5.3%, Bank -5.2%, REITs IYR -5.1% and so on.

In yesterday’s sell-off, the DJI, S&P 500 and NASDAQ all finished below near term support levels that I mentioned in my earlier post and the possibility of retesting of Nov lows now seem higher. Keep in mind though, that 90% Down Days are frequently followed by rallies of 2-7 days, but that isn’t necessarily true all the time. Let’s wait for either the follow through or reversals. The US market’s reactions was followed through to the Asia and rest of the world and index lost heavily across the board. Key one to mention is Japan’s Nikkei average that fell 4.9% on a record fall in Japanese machinery orders .

But the action is not yet over, We have PPI and Jobless claims at 8:30am US EST today. You may want to stay in touch with my updates on InvesCafe which I may use for intraday opportunities.

Rest Later, profitable trading, OP

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