Stubborn inflation and rising interest rates have begun to weigh on Wall Street, with JPMorgan Chase reporting surprisingly weak third-quarter earnings. The bank earned $15.3 billion in profit, falling short of the $16 billion analysts expected. JPMorgan cited lower trading revenues, a slowdown in debt deals, and increased provisions for future losses as key pressures. CEO Jamie Dimon warned that continued Federal Reserve rate hikes could bring more pain, saying "the next 1 percent will be more painful."
Wells Fargo also saw revenue fall slightly short of expectations, though it maintained profits by cutting expenses, including through AI-driven layoffs. Both banks’ stocks traded flat to down in premarket trading. In contrast, rival Goldman Sachs outperformed, with profits up 29% and revenue up 23%, beating estimates. Its results were boosted by fees from underwriting SpaceX’s IPO and strong stock trading performance.
The mixed results come after one of the industry’s most profitable periods, fueled by a roaring stock market and heavy borrowing to finance AI infrastructure expansion. While some banks had warned their Q3 results might not match earlier momentum, Wells Fargo remained optimistic, citing low loan delinquencies, rising deposits, and strong wage growth as signs of resilience.
Source: New York Times Business · Résumé par HeadlinesBriefing