Leon Hinde

The following charts of Dow Jones’ large caps General Electric and JP Morgan, provide an interesting technical perspective of one of the world’s largest industrial conglomerates and one of America’s largest financial institutions.

GE reported late in the week and at first glance the headline number looked okay, but after digging deeper the free cash flow provided a concern and the stock sold off.

In the case of JP Morgan and other US banks, we’ve watched their share prices sell-off from the March highs as the long end of the yield curve flattens. The implication for banks is, a flattening yield curve will reduce their net interest margins.

US banks have now retraced on average 10%+ from their recent highs.

Goldman shares dropped more than 5 percent overnight to trade at their lowest since the end of November and are down 10 percent for the year so far. The US financials sector is about 1 percent lower year to date

Goldman Sachs reported 1Q earnings per share of $5.15 a share, missing a consensus estimate by 16 cents. Revenue came in short by about $420 million at $8.026 billion.

The last time Goldman reported a miss on earnings per share was the fourth quarter of 2015.

Technical buying support may start to build at or near $200.

In many cases the leading US banks are now off over 10% from their recent highs.

The following charts show Goldman Sachs and JP Morgan are testing last week’s support levels and in the case of Wells Fargo, the price action is much weaker.