CNBC Daily Open: For banks, big profits don’t mean market gains

Lackluster markets
U.S. stocks traded mixed Friday, with the Dow Jones Industrial Average the lone large scale to rise, though each large indexes ended successful the greenish for the week. European markets closed lower aft 5 affirmative sessions. The benchmark Stoxx 600 scale retreated 0.11%, dragged down by telecom stocks aft downbeat quality from Nokia and Ericsson.

Biggest slope gets bigger
JPMorgan Chase's second-quarter nett income surged 67% to $14.5 billion, oregon $4.75 per share. When excluding its acquisition of First Republic, net were $4.37 per share. Revenue grew 34% to deed $42.4 billion, boosted by a 44% leap successful nett involvement income. All figures bushed Wall Street's estimates — and the bank's own, causing it to raise its expectations for the afloat year's nett involvement income.

Caged bird
Twitter's experiencing antagonistic currency flow due to the fact that of an astir 50% driblet successful advertizing gross and "heavy debt," Elon Musk said Saturday morning. Musk, who is Twitter's CTO and enforcement chairman, told a BBC reporter successful April that the company's "roughly breakeven" and expected to person affirmative currency travel wrong the adjacent quarter.

Thawing Activision Blizzard deal
Microsoft's one measurement closer to acquiring Activision Blizzard. The U.S. Appeals Court connected Friday denied the Federal Trade Commission's question to halt the $68.7 cardinal deal, portion Britain's contention regulator said it would consider Microsoft's proposals to "restructure the transaction." Meanwhile, Sony's signed a 10-year statement with Microsoft to keep Activision's Call of Duty connected the PlayStation console.

[PRO] Ripple effects
A justice successful the Southern District of New York ruled Thursday that Ripple's XRP token is "not needfully a information connected its face." That's a triumph not conscionable for Ripple, a crypto company, but the wider industry. CNBC Pro's Tanaya Macheel explains what the lawsuit means for crypto companies similar Coinbase.

Despite large banks posting coagulated net for their 2nd quarter, they didn't reap rewards successful banal markets Friday.

Citigroup's net and gross beat expectations. Its shares sank 4.05%. Likewise, Wells Fargo reported better-than-expected net and revenue, and raised its guidance for full-year nett involvement income. Still, marketplace effect was muted. Shares of Wells Fargo slipped 0.34%

Even JPMorgan, the expansive dame of U.S. banks, didn't negociate to rouse capitalist interest. Its nett income soared 67% twelvemonth implicit year; its banal inched up 0.6%.

Why aren't investors much excited astir banks?

The representation of March's banking turmoil, I think, inactive lingers. Higher involvement rates whitethorn payment large banks due to the fact that their deposits are comparatively sticky compared with those astatine determination banks — specified arsenic the ill-fated Silicon Valley Bank.

But precocious rates are besides deepening commercialized existent property debt, impeding dealmaking and lowering indebtedness request — each headwinds for banks, careless of their size. It's hard, successful different words, to muster enthusiasm implicit banks erstwhile rates are inactive astatine historically precocious levels.

Another crushed for the disinterest successful the banking sector, I think, is due to the fact that stocks are fundamentally promises of aboriginal earnings. And there's thing caller oregon breathtaking that banks tin do, really, to make income.

In fact, I'd reason that banks are expected to beryllium boring. No 1 wants the spot wherever they entrust their wealth to beryllium exciting. The banks that collapsed this twelvemonth were all, loosely speaking, deviating from boring banking business: Focusing connected tech startups, the crypto industry, oregon — successful the lawsuit of Credit Suisse — conscionable straightforwardly plagued by scandals.

It's possibly not a atrocious thing, then, that investors aren't piling into large banks.