1. Dow set to jump at open as earnings seasons kicks off
U.S. stock futures were pointing to an over 400-point advance for the Dow Jones Industrial Average at Tuesday's open as Wall Street looks to companies reporting quarterly earnings for signals on how they're navigating the coronavirus crisis. Profit and loss estimates and forward guidance are expected to be murky. The impact of the virus on business might be somewhat muted as state stay-at-home orders were taking effect toward the end of the January-to-March quarter. Two Dow components — JPMorgan Chase and Johnson & Johnson — kicked off earnings season before the bell Tuesday. If the projected gains for the Dow were to hold by the close, blue chips would get back what they lost Monday and then some. Heading into the new session, the Dow was off nearly 21% from its February record highs.
2. JPMorgan posts earnings decline, record markets revenue
Shares of JPMorgan were 3% higher in the premarket after the banking giant posted record trading revenue during the surge in market volatility in the first quarter. The company reported a worse-than-expected 78 cents per share as it added $6.8 billion to loan loss provisions. Net income of $2.87 billion plunged 69% from a year earlier. Revenue of about $29 billion also missed estimates. "JPMorgan Chase performed well in what was a very tough and unique operating environment," CEO Jamie Dimon said in the Q1 press release, adding the bank remains well capitalized. Wells Fargo reported first-quarter earnings well below expectations as the company also set aside money for potential credit losses. Quarterly revenue at the bank also missed forecasts.
3. J&J raises dividend, cuts full-year guidance
Shares of Johnson & Johnson were up 3% in Tuesday's premarket trading after the company reported better-than-expected adjusted earnings of $2.30 per share in the first quarter on revenue of nearly $20.7 billion. The U.S. drug giant also raised its quarterly dividend. However, citing the uncertainty of the coronavirus, J&J cut its full-year profit forecast. CFO Joseph Wolk told CNBC on Tuesday morning that the postponement of elective surgeries to keep hospital beds open for Covid-19 patients put pressure on its medical devices unit. But he said consumer health products and pharmaceuticals were stronger for the quarter.
4. Slowing of new cases shifts debate to reopening
The Trump administration is expected to announce as early as Tuesday a second coronavirus task force. The new council, which is not expected to include health officials, is aimed at advising the president on how to begin reopening the economy as new U.S. infections begin to slow. As governors on the East and West Coasts build coalitions to coordinate easing stay-at-home orders, President Donald Trump said he has the final word on reopening, not the states. However, legal experts say otherwise, pointing out that U.S. law gives state governors wide latitude on health and safety. Secondly, they say that Trump never declared a nationwide lockdown, so there's no mechanism by which he could order a nationwide reopening. At his daily coronavirus briefing, Trump played a campaign-style video, portraying his initial response to the outbreak as a bold success. In an in-depth look this weekend, The New York Times found that Trump's response to the pandemic was halting despite early warnings.
5. New York governor says state 'controlling the spread'
U.S. coronavirus cases are approaching 583,000 with 23,649 deaths. Democratic New York Gov. Andrew Cuomo said Monday the state, which has the most cases and fatalities in America, is "controlling the spread," citing a flattening of the daily death toll, a flattening in the net number of hospitalizations and a drop in the number of people on ventilators. However, deaths in New York topped 10,000 on almost 200,000 cases. Global cases are nearing 2 million. The death toll worldwide is 120,450.
— The Associated Press contributed to this report.
