US pre-open: US stocks to rebound amid Wells Fargo earnings


LONDON (ShareCast) - Upbeat results from Wells Fargo & Co were expected to help US stocks rise on Friday, as markets recovered after concerns about the Portuguese banking sector hit sentiment the previous session.

Futures on Wall Street were showing gains of 0.2-0.3% across the Dow Jones Industrial Average, S&P 500 and Nasdaq ahead of the opening bell.

Second-quarter figures from Wells Fargo & Co were being closely watched today with the company being the first of the major US banks to report results this earnings season.

The group, which is the largest mortgage provider in the States, reported a 3% rise in earnings to 101 cents a share, up from 98 cents the year before and as expected by analysts. Revenue slipped to $21.1bn from $21.4bn but came in slightly ahead of the $20.84bn forecast. Shares (Frankfurt: DI6.F - news) were slightly lower in pre-market trade.

Ahead of Wells Fargo's results, Alastair McCaig, Market Analyst at IG (LSE: IGG.L - news) , said: "Being focused on the debt market and less exposed to the investment market, this should ensure a solid start for the banks."

In other news, comments from Kansas City Federal Reserve President Esther George were in focus today after she added to speculation regarding future monetary policy and the first rate hike.

Speaking last night, she highlighted positive developments in the US labour market and said inflation was running closer to the Fed's target. George, who isn't a voting member of the Federal Open Market Committee, said that the Fed could begin to raise rates "as early as even this year".

"As I look at some of the policy prescriptions that the Federal Reserve relies on, looking at formulas that help guide you on when it's time to change, many of those are already pointing to lifting off of zero as early as even this year or next year."


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