Growing signs that stock markets are getting ahead of themselves

Market Beat: Investors are responding to target-beating results with a ‘meh’

The reception on Wall Street to a succession of banks beating targets? Most of their shares fell on the day they reported. Photograph: iStock

The reception on Wall Street to a succession of banks beating targets? Most of their shares fell on the day they reported. Photograph: iStock

JP Morgan, the largest bank in the US by assets, set the tone for global earnings season on Tuesday, reporting that its earnings per share soared an annual 174 per cent in the second quarter. It beat analysts’ expectations by almost a fifth, flattered as the bank freed up some of the money set aside last year for bad loan losses as a result of Covid-19.

Goldman Sachs’ results were even more impressive, topping market expectations by almost 50 per cent, as the investment bank raked it in working on a boom in initial public offerings (IPOs) in buoyant markets. Not to be left out, Citigroup, Bank of America and Wells Fargo also beat earnings during the week.

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