Fourth-quarter US earnings seen up 4.4% as reporting period kicks off

By Caroline Valetkevitch

NEW YORK (Reuters) - Fourth-quarter earnings for S&P 500 companies overall are expected to have increased 4.4% from a year earlier, LSEG data showed on Friday, just as results from four of the country's biggest banks kicked off the latest U.S. earnings season.

That increase is down from a 5.2% gain estimated on Dec. 22, and it follows a 7.5% rise in the third quarter and a 2.8% fall in the second quarter of last year, based on LSEG data.

The third quarter of 2023 "marked the beginning of an earnings recovery, which is forecasted to reaccelerate throughout 2024," UBS equity strategist Jonathan Golub and his team wrote in a note this week.

However, revisions for fourth-quarter estimates have been weaker than the historical trend, he wrote.

Analysts expect S&P 500 earnings to rise by 11% in 2024 after increasing just 2.9% in 2023, based on LSEG data

Major U.S. banks reported lower profit on Friday in a quarter hit by special charges and job cuts.

The banks - JPMorgan, Wells Fargo, Bank of America, and Citigroup - also said that American consumers remained resilient, although defaults on consumer loans began returning to pre-pandemic levels.

Even as its quarterly profit fell, JPMorgan reported its best-ever annual profit and forecast higher-than-expected interest income for 2024.

Among companies due to report next week are Goldman Sachs, Morgan Stanley and Travelers Cos.

(Reporting by Caroline Valetkevitch; Editing by Andrea Ricci)

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