FTSE gains 16 points in early trade all eyes on JP Morgan results

The FTSE 100 gained 16 points in early trade on Friday, helped by gains in financial stocks ahead of results from US banking heavyweight JP Morgan, whilst the Italian bond auction, which did see falling yields, failed to spur markets forward.

From a sector perspective, it is the financial stocks leading the charge higher in Europea, with the FTSE 350 banking sector rallying 1.9%. Stocks such as Royal Bank of Scotland, whose shares continue to rally after the announcement yesterday of further bank restructuring and cost saving, Barclays and Lloyds are leading the FTSE 100 higher. Undoubtedly there is also an eye towards the results from JP Morgan at noon today and so there is every chance this sector may see some added volatility as the afternoon approaches.

JP Morgan is expected to deliver a fall in earnings per share from $1.12 a year ago to $0.92 this time around. Should results beat expectations, we could see European banks receive a boost going into the closing session.

The Italian bond auction saw Italy sell €4.75 billion worth of government bonds. Three-year debt saw a bid to cover ratio of 1.22, somewhat weaker than last time around, countering the benefit of a fall in gross yields to 4.83% from 5.62%. As such, the result of the auction itself is seen as somewhat mixed and did trigger a bit of stock weakness in the immediate aftermath of the results being made clear.

We have some potentially market moving economic data out of the US in the afternoon session, that could impact the way European stocks close out for the week. At 1.30pm GMT we see International Trade figures alongside import and export price data, which will both giver a greater insight into likely US GDP progression. Just before 3pm we also see more evidence of US consumer sentiment also, which will need to be watched by traders who have positions in dollar related markets and global indices.