(Reuters) – Falling energy shares late on Friday jeopardized continuation of Wall Street’s five-session rally as investors looked ahead to earnings season, which will kick off with Citigroup, JPMorgan and other big banks next week.
FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., January 10, 2019. REUTERS/Brendan McDermid
Underpinned by optimism over China-U.S. trade talks and expectations of a slow pace of interest rate hikes from the Federal Reserve, the stock market’s recent winning streak added 6 percent to the S&P 500 .SPX and left it up about 10 percent from the 20-month low it hit around Christmas.
“We’ve clawed our way back and now the market is just waiting ahead of the start of earnings season next week,” said Donald Selkin, Chief Market Strategist at Newbridge Securities in New York. “We’re just drifting.”
The S&P energy index .SPNY dipped 0.84 percent, leading declines among 11 sectors as oil prices LCOc1 dropped after nine days of gains. [O/R]
The financial index .SPSY climbed 0.16 percent. Citigroup Inc (C.N), which will report earnings on Monday, rose 1 percent after agreeing to give shareholder ValueAct Capital more access to its books and board of directors.
JPMorgan Chase & Co (JPM.N), which reports on Tuesday, dipped 0.41 percent.
U.S. stocks took a severe beating in the last quarter of 2018 due to worries over trade, rate hikes and a slowdown in global growth.
Analysts expect S&P 500 companies’ earnings per share to grow by 6.4 percent this year, compared with 23.5 percent in 2018, when they were supercharged by newly enacted corporate tax cuts, according to IBES data from Refinitiv.
General Motors (GM.N) on Friday gave a strong earnings forecast for 2019, sending the automaker’s shares surging 7.6 percent.
At 2:44 pm ET, the