Earnings live updates: Citi and BlackRock stocks rise on strong results, Johnson & Johnson profit beats estimates

Q1 earnings season is opening with a broadly constructive tone, as analysts expect the S&P 500 to post its sixth straight quarter of double-digit earnings growth, with 13.2% year-over-year earnings growth now forecast. Several large companies reported solid results, including Citi with EPS of $3.06 versus $2.63 expected and profits up 42%, J&J with EPS of $2.70 versus $2.68 expected and revenue of $24 billion versus $23.6 billion expected, and BlackRock with EPS of $12.53 versus $11.50 expected and revenue of $6.7 billion versus $6.4 billion expected. Wells Fargo beat EPS estimates but missed on revenue and net interest income, while Fastenal fell after in-line results and a flat growth outlook.

Analysis

The market is rewarding proof-of-demand over macro caution: the cleanest long exposure remains the banks with visible capital-markets and trading leverage, while lenders tied to spread income are being punished for a slower pass-through on deposit costs. Citi’s outperformance matters less for one quarter’s beat than for what it says about deal activity and market-making breadth; if that strength persists, it can pull the entire large-cap financial complex higher, but the dispersion should stay wide because NII-sensitive banks have a different driver set than fee-heavy peers.

BlackRock is the clearest structural winner in this tape because it compounds two tailwinds at once: higher market levels lift AUM mechanically, and risk appetite increases the probability of positive net flows into passive and alternatives. That creates a reflexive earnings profile that can outperform even if rates stay sticky, and it also pressures smaller managers and active-only platforms that lack the same operating leverage. The next leg higher in BLK is more likely to come from guidance around flow persistence than from one-quarter fee beats.

Healthcare is more nuanced: JNJ’s ability to hold earnings while absorbing patent erosion suggests the market is underestimating the durability of its oncology and immunology portfolio mix. The stock may look muted because investors are anchoring to the looming Stelara drag, but the second-order read is that this is a pipeline transition story, not a terminal margin story; that should support the multiple over the next 6–12 months if the company avoids a guidance reset.

The contrarian setup is in the “defensive disappointment” trade: FAST’s weak reaction hints that cyclicals are being sold not because the economy is collapsing, but because investors are looking for any sign that pricing power is rolling over. If rates stay high and growth decelerates only modestly, that setup is bullish for short-duration quality and bearish for the more rate-sensitive industrial suppliers. The main reversal risk is a sudden broadening of earnings beats outside financials, which would force de-risking from defensive and NII-sensitive shorts into the second half of the quarter.

Key Decisions for Investors

• Go long BLK vs. short a basket of subscale active managers for 1-3 months; expect AUM-driven operating leverage to keep outpacing peers if markets remain supportive, with downside limited unless equity volatility spikes sharply.
• Add C and JPM on pullbacks over the next 2-4 weeks; both have clearer upside from capital-markets normalization than NII-only lenders, and the risk/reward favors owning the banks with the best fee leverage rather than the most rate sensitivity.
• Maintain a tactical short or underweight in WFC for 1-2 months versus C/JPM; the thesis is that the market will keep penalizing weaker spread income even if headline results look adequate, unless deposit costs stabilize faster than expected.
• Initiate a modest long in JNJ with a 6-12 month horizon; the setup is a mean-reversion trade on multiple compression if oncology and immunology offset the patent cliff better than consensus assumes.
• Fade FAST on rallies over the next quarter via short or put spreads; the risk/reward is attractive if industrial end-demand remains merely soft rather than collapsing, because margins can compress faster than the market is pricing.