Listen to this articleOn Wednesday, JPM (JPMorgan Chase) issued results of a mixed first quarter in a report. The report also warned of considerable geopolitical and economic issues beyond the continuous Russian war against Ukraine.
CEO of JPM Jamie Dimon softened the expectations of a US collapse during the current year, while JPMorgan stock dropped. The bank report said the Russian invasion has declined profits, which caused the market uproar. It also prompted it to reserve more money to handle inflation threats.
Moreover, GS (Goldman Sachs) and many other money center banks reported that a recovering economy could crash with increasing prices. Most of the banking giants of the nation also reported beginning to loop more powerful results than the previous year.
The markets are shaking and investors are to steer the collision from the war. The efforts of the Federal Reserves are continuously fighting against increasing prices. JPMorgan said prior to announcing the results that the market circumstances stayed unfaithful.
The Earnings of JPMorgan
The earnings of JPMorgan dropped to $2.63 per share and marked a 42% decrease from a year ago. It was well below the estimated $2.72 a share. The revenue generation was recorded at $31.59 billion with a 5% decline. However, the high-value figure headed predicted for $30.60 billion.
The report also pointed out a $902 million credit reserve build after improving the possibility of drawback chances. The major reason was the high inflation and the Russia-Ukraine war as well as other manifestation of Russia.
JPMorgan lost $524 million in Investment Sector
The report of JPMorgan pointed to a $524 million in losses in its investment and corporate banking sector. The reason behind the losses was commodities exposure linked to Russian affiliated parties. Dimon said in a statement that the bank is still optimistic about the economy supposedly for the short term.
He said business and consumer balance sheets and their spending stay at strong levels. However, there are considerable geopolitical and economic issues in front of increasing prices, supply chain, and war-related issues. Dimon said he didn’t consider any chance of a recession in the United States in the current year.
JPMorgan dropped 3% in the first quarter
So, the exact forecasting was more difficult and sometimes disadvantageous. He said a war normally doesn’t entirely affect the global economy during a short time period. He also forwarded an annual letter earlier this month to JPMorgan shareholders. He wrote the economists of the bank considered the war and sanctions to drop the Russian economy by 12.5%.
Total markets trading revenue of JPMorgan dropped 3% during the first quarter of 2022. The lower underwriting fees for stock and debt grants caused a decline. The revenue of fixed-income markets declined 1%, equity markets revenue dropped 7%, and the revenue from investment banking fell 28%.
The Stocks of JPMorgan Bank
Today, JPMorgan stock dropped 3.1% in the stock market. The EPS Rating was 65 and shares showed a Composite Rating of 39. The relative strength of the stock line has dropped. The BAC (Bank of America) stocks decreased by 0.8%. The WFC (Wells Fargo) was normal and consolidated. The results from Wells Fargo are expected on Thursday, while the Bank of America will release results next week.
The Federal Reserve increased its major interest rate for the first time in March. It traditionally enables banks to charge more on their loans to enhance profit. However, the bank stocks have dropped in the recent weeks over flattening curve concerns. A flatter curve is supposedly a sign of increasing investor worry about the economy.
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