• US Banks are set to open higher after the latest trading updates
  • Goldman Sachs and Morgan Stanley both higher in pre-market trade
  • US30 makes new all-time high and closing in on 23000

The latest earnings releases from Goldman Sachs and Morgan Stanley have been warmly greeted by investors with both banks seeing notable gains in pre-market trade. Shares have risen by around 1% ahead of the cash open at 2:30 PM (BST) and there could be more gains ahead after the opening bell.

Goldman Sachs reported Q3 earnings of $5.02 per share against $4.17 expected and  $4.88 per share for the same period last year. A beat in revenue with $8.33B announced compared to $7.54B is another clear positive on what is an all round pleasing release for the bank. Whilst the company still produced a weak performance in its bread-and-butter business of fixed-income trading, this was expected and broadly inline with that seen amongst its rivals. 

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 Goldman Sachs could be set to resume the large rally seen since last year’s US election. Source: xStation

Morgan Stanley has also delivered some pleasing news for shareholders in beating on both the top and bottom line. Third quarter earnings per share came in a $0.93 against a street forecast of $0.81. Revenue also came in above forecast, with $9.197B beating the $9.015B expected. 

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 Morgan Stanley trades not far form its 2017 peak and could break higher following the earnings release. Source: xStation

With two of the largest banks both reporting strong results the Wall Street open is expected to be positive for stock indices with the US30 closing in on the 23000 level and already making an all-time high this morning. The rise seen in Goldman Sachs account fro around 20 points of the gains seen today and the market has rallied an incredible 1200 points since the early September lows. The RSI on a daily chart is firmly in overbought territory with a reading above 80 but that doesn’t necessarily mean the market is due a pullback. Until there is some sort of candlestick reversal signal then the latest uptrend remains firmly intact and we could be set to see more record highs in the coming days. 

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 The US30 is nearing the 23000 handle after making another all-time high today. The RSI of 82 could be seen to suggest overbought conditions. Source: xStation