JAMIE DIMON - JPMorgan Chase continue to fly over the radar for accountability

 

JULY 14, 2023

MORNING SQUAWK

1. Rolling into Friday Stocks have finished higher all four days this week. The Nasdaq, especially, is rolling along. The tech-heavy index is headed toward its best week since March. Inflation is softening, as this week’s consumer and wholesale inflation readings showed, giving investors hope that we’re headed for a soft landing after more than a year of Federal Reserve rate hikes. Still, we’re entering earnings season, and there are plenty of wild cards. Big banks start reporting Friday (more on that below), giving us a taste of the deluge to come next week. Follow live market updates.   2. Here come the banks Big banks started reporting earnings Friday morning, led by JPMorgan Chase. The Jamie Dimon-led bank benefited from higher rates and interest income, helping it easily top Wall Street’s expectations on the top and bottom lines for the second quarter. Dimon also weighed in the state of the economy. “Consumer balance sheets remain healthy, and consumers are spending, albeit a little more slowly. Labor markets have softened somewhat, but job growth remains strong,” the CEO said in the firm’s earnings release, although he also highlighted ongoing risks such as inflation and dwindling consumer savings. Investors will also digest Wells Fargo and Citigroup earnings Friday.

3. Hollywood shuts down For the first time in 63 years, both Hollywood writers and actors are on strike. That means the industry is practically shut down, and it doesn’t look like we’re going to get a resolution any time soon. The actors and writers unions, which represent tens of thousands of laborers, say they want better job security and guardrails against artificial intelligence. Screen Actors Guild President Fran Drescher, better known as the star of sitcom “The Nanny,” ripped the studios’ response to actors’ demands. “It is disgusting,” she said. “Shame on them.” The studios are standing firm, as well. Disney CEO Bob Iger called the strikers’ expectations “not realistic.”   4. Disney tuning out TV Beyond his remarks on the Hollywood strikes, Iger made even bigger news Thursday. The Disney chief told CNBC’s David Faber that the company is essentially opening the door to a sale of its traditional TV and cable assets. That means Disney could shed its ABC network as well as cable channels such as FX, as it goes all in on streaming. Iger also said the company is entertaining the idea of finding a strategic partner for ESPN as the sports network moves toward a direct-to-consumer model and away from old-fashioned cable TV. These developments set up the complex next stages of Iger’s strategy for the House of Mouse now that his contract is extended through 2026.   5. Bittersweet development The World Health Organization warned Thursday that aspartame, the popular sweetener used in sugar-free soda and gum, might cause cancer, but only if you consume it in large quantities every day. “In our view, this is really more a call to the research community to try to better clarify and understand the carcinogenic hazard that may or may not be posed by aspartame consumption,” said Dr. Mary Schubauer-Berigan, a senior official at the WHO’s International Agency for Research on Cancer. Still, there’s a chance the findings could push consumers away from diet sodas, or even force the industry to develop new formulas, but companies aren’t sweating any possible changes yet. **************************************** WHAT DO YOU THINK?