The Dow Jones Industrial Average (DJINDICES:^DJI) has lost two points in pre-market trading, suggesting a flat start to the stock market today. World indexes rose slightly in overnight trading. European shares have recovered a bit from yesterday's rout and were headed for their first daily gain in a week. The Stoxx index was up 0.4% as of 8:30 a.m EDT.
Wells Fargo kicked off earnings season for banks by posting solid second-quarter results. Revenue was $21.1 billion, down slightly from the prior year and even with Wall Street's projections. As expected, earnings ticked higher by 3% year over year to reach $1.01 a share. The bank saw growth across its business lines: interest income and noninterest income both contributed revenue gains. CEO John Stumpf sounded an optimistic tone about the economic recovery, saying in a press release that second-quarter results were boosted by "strong credit quality driven by an improved economy, particularly the housing market." In fact, credit losses plunged to $717 million, or 40% below the prior-year period, as the bank's loan quality continued to improve. The stock was down 1.1% in pre-market trading.
Fastenal announced today that sales for its fiscal second quarter rose 12% to reach $950 million. However, consistent with recent trends, earnings improved at a slower pace, up just over 7% to $0.44 a share. Both those top and bottom-line figures matched Wall Street's estimates exactly. The industrial and construction materials company also provided an extensive business update that detailed its growth strategy. While the update delved into all the financial metrics that management sees as key drivers for the business, the section that will interest investors most involved gross profit. That figure was 50.8% in the quarter, down almost 2 percentage points from the year-ago period and below management's stated goal of between 51% and 53%. Management expects to keep profitability just below target for the time being in the interest of maximizing sales growth. The stock was down 4% in pre-market trading.