State Street Up Next
US earnings season rolls on today with State Street among the big names reporting. On the back of mixed results from financial earlier in the week (Morgan Stanley beat estimates, Goldman Sachs missed estimates), traders will now be looking to see which side of the line State Street falls on. The bank is forecast to see an EPS of $1.98 on revenues of $3.03 billion.
Broader Risk Impact
With a solid record of earnings beats (last missed estimates in Q3 2018), a positive set of results from State Street today is the base case scenario and should help lift broader stock sentiment if seen. However, should the company’s results disappoint, this would likely be a major blow to already fragile stock sentiment, dragging stocks lower into the weekend. Of particular note for traders will be the data around credit loss provisions as well as the bank’s overall view on the US economy and recession risks.
The rally in the bank’s stock has seen price trading back up to retest the 82.55 resistance area, with the bear trend line from last year’s highs coming in around there also. For now, this area is holding and with momentum studies weakening, a further correction lower looks likely. However, while price holds above the 73.79 level, the outlook remains bullish with the focus on an eventual break of 82.55 and a move up towards 91.64 thereafter.