From Nasdaq: 2024-12-27 07:30:00

The Q1 2025 earnings reporting cycle is set to begin with almost all S&P 500 companies reporting CQ4 results. Financials are expected to lead with over 40% growth, with JPMorgan Chase & Company kicking off the cycle on January 15th. Large banks like JPMorgan, Berkshire Hathaway, Visa, and Mastercard are expected to post gains. The sector is on track for robust capital returns in 2025.

JPMorgan, the largest bank globally outside of China, is forecasted to report adjusted earnings of $3.89, a 28% increase from last year. Strong consumer strength, increased credit use, and higher interest rates contribute to potential outperformance. The U.S. economy is resilient with growth expected above 3% in Q4 2024 and at least 2% in 2025.

Financials, particularly large banks, may benefit from a lawsuit against the FOMC over capital requirements. The Fed plans to alter stress tests to reduce volatility and improve transparency, which could positively impact bank stocks and the broader market. Forecasts for Q4 and 2025 earnings growth remain strong, aligning with higher S&P 500 index prices.

The S&P 500 faces a critical juncture in January ahead of the earnings reporting cycle. The index is currently trending higher but may face resistance at the 6,100 target. Earnings growth and expected acceleration could push the index above 7,000 by the end of 2025, but failure to break through could result in a correction or range-bound movement.



Read more at Nasdaq:: S&P 500 Earnings Set to Shine: January’s Critical Market Test