Quantcast
Connect with us

Mixed earnings at large US banks as Fed rate cut looms

Published

on

JPMorgan Chase reported record quarterly profits on Tuesday behind strong consumer business, but shares were pressured by worries over expected Federal Reserve interest rate cuts on a day of mixed results by large banks.

Wells Fargo also notched higher profits, while Goldman Sachs reported a dip in profits, but topped analyst expectations.

ADVERTISEMENT

The trio of results moved markets into the heart of second-quarter earnings season, which comes against a backdrop of uncertainty over international trade and an anticipated loosening of monetary policy, with the Fed expected to cut interest rates later this month.

Lower interest rates are generally viewed as a drag for large banks because it reduces the net interest income of financial companies — the difference between the interest rates it charges consumers for loans and the interest it must pay for deposits.

At JPMorgan, key areas of strength included consumer banking, where it scored from higher net interest income. JPMorgan also generated increased revenues connected to the credit card business and higher auto loans and lease originations.

Net profit came in at $9.7 billion, up 16.1 percent and a company record.

ADVERTISEMENT

Revenues were up 4.1 percent to $29.6 billion.

Chief executive Jamie Dimon offered an upbeat appraisal of the US economy.

ADVERTISEMENT

“We continue to see positive momentum with the US consumer ? healthy confidence levels, solid job creation and rising wages ? which are reflected in our Consumer & Community Banking results,” he said.

But shares were choppy after the report, with analysts pointing to the bank’s forecast for $57.5 billion in 2019 net interest income, down from the prior $58 billion forecast. The decline reflects the expected hit from Fed actions to cut rates.

JPMorgan Chase reported a jump in second-quarter profits on Tuesday behind strength in consumer and business banking as its CEO offered an upbeat appraisal of US economic trends.

ADVERTISEMENT

– Higher profits at Wells –

At Wells Fargo, net income rose 19.7 percent to $6.2 billion, while revenues were essentially flat at $21.6 billion.

Wells Fargo experienced a dip in net interest income but that was largely offset by other gains, such as higher service charges on deposit accounts and lower non-interest expenses.

ADVERTISEMENT

Results in the year-ago period were hit by a large one-time tax expense.

“In second quarter 2019, we recorded strong earnings and continued to make progress on our top priorities: focusing on our customers and team members; meeting the expectations of our regulators; and continuing the important transformation of our company,” said interim chief executive Allen Parker.

At Goldman Sachs, net income was $2.2 billion, down 6.4 percent from the year-ago period.

ADVERTISEMENT

Revenues dropped 1.8 percent to $9.5 billion.

– Goldman trading hit –

Goldman suffered from a decline in fixed income, currency and commodity trading, a weakness at other large banks.

ADVERTISEMENT

Financial advisory revenues also fell due to lower merger and acquisition activity compared with the year-ago period. Debt underwriting revenue also fell.

“We’re encouraged by the results for the first half of the year as we continue to invest in new businesses and growth to serve a broader array of clients,” chief executive David Solomon said in a statement.

“Given the strength of our client franchise, we are well positioned to benefit from a growing global economy.”

ADVERTISEMENT

Shares in JPMorgan fell 0.1 percent to $113.83 in early trading. Wells Fargo rose 0.3 percent to $46.84, while Goldman Sachs rose 2.1 percent to $215.97.

Enjoy this piece?

… then let us make a small request. Like you, we here at Raw Story believe in the power of progressive journalism — and we’re investing in investigative reporting as other publications give it the ax. Raw Story readers power David Cay Johnston’s DCReport, which we've expanded to keep watch in Washington. We’ve exposed billionaire tax evasion and uncovered White House efforts to poison our water. We’ve revealed financial scams that prey on veterans, and legal efforts to harm workers exploited by abusive bosses. We’ve launched a weekly podcast, “We’ve Got Issues,” focused on issues, not tweets. And unlike other news outlets, we’ve decided to make our original content free. But we need your support to do what we do.

Raw Story is independent. You won’t find mainstream media bias here. We’re not part of a conglomerate, or a project of venture capital bros. From unflinching coverage of racism, to revealing efforts to erode our rights, Raw Story will continue to expose hypocrisy and harm. Unhinged from billionaires and corporate overlords, we fight to ensure no one is forgotten.

We need your support to keep producing quality journalism and deepen our investigative reporting. Every reader contribution, whatever the amount, makes a tremendous difference. Invest with us in the future. Make a one-time contribution to Raw Story Investigates, or click here to become a subscriber. Thank you. Click to donate by check.

Enjoy this piece?

… then let us make a small request. Like you, we here at Raw Story believe in the power of progressive journalism — and we’re investing in investigative reporting as other publications give it the ax. Raw Story readers power David Cay Johnston’s DCReport, which we've expanded to keep watch in Washington. We’ve exposed billionaire tax evasion and uncovered White House efforts to poison our water. We’ve revealed financial scams that prey on veterans, and efforts to harm workers exploited by abusive bosses. We’ve launched a weekly podcast, “We’ve Got Issues,” focused on issues, not tweets. Unlike other news sites, we’ve decided to make our original content free. But we need your support to do what we do.

Raw Story is independent. You won’t find mainstream media bias here. We’re not part of a conglomerate, or a project of venture capital bros. From unflinching coverage of racism, to revealing efforts to erode our rights, Raw Story will continue to expose hypocrisy and harm. Unhinged from corporate overlords, we fight to ensure no one is forgotten.

We need your support to keep producing quality journalism and deepen our investigative reporting. Every reader contribution, whatever the amount, makes a tremendous difference. Invest with us in the future. Make a one-time contribution to Raw Story Investigates, or click here to become a subscriber. Thank you.



Report typos and corrections to: [email protected]. Send news tips to: [email protected].
READ COMMENTS - JOIN THE DISCUSSION
Continue Reading

2020 Election

Democrats could flip the Texas state house in 2020 — and reshape the national map

Published

on

Blue Texas? Democrats have long dreamt of winning Texas’s 38 electoral votes in the presidential election. That may still be a long shot, but a recent “Texodus” from Congress has given new talk to a political transformation across the Lone Star State that could have massive ramifications down the ballot and for decades to come.

This article was originally posted at Salon.

Four of the state’s GOP members of Congress have announced their retirements in recent weeks, an unusual torrent of departures signaling that a storm is coming. And evidence shows that it’s not just hitting Texas’s federal delegation. It’s coming to Austin, too.

Continue Reading

Breaking Banner

‘There’s an awful lot of really good Republicans out there’: Joe Biden at Cape Cod fundraiser

Published

on

Former Vice President Joe Biden defended Republican lawmakers in DC as "decent people" during a campaign fundraiser held at Cape Cod.

"There’s an awful lot of really good Republicans out there," Biden argued, according to Washington Post reporter Matt Viser.

"I get in trouble for saying that with Democrats, but...every time we ever got in trouble with our administration, remember who got sent up to Capitol Hill to fix it? Me," he said.

”Because they know I respect the other team. I do. They’re decent people," Biden claimed. "They ran because they care about things, but they’re intimidated right now.”

Continue Reading
 

Breaking Banner

Neo-Nazi ‘Atomwaffen Division’ holding live-fire militia trainings at ‘The Base’ near Spokane: report

Published

on

One sign of the growing white nationalist crisis in America is a new outreach effort for paramilitary training.

"A neo-Nazi group focused on providing paramilitary-style training to far-right extremists has been conducting a massive recruitment drive and claims to have already conducted live-fire training with its members," Vice News reports.

"The Base, which is connected to extreme-right groups the Atomwaffen Division and the Feuerkrieg Division, has been promoting its growth on social media with photos announcing its presence in major cities across North America, including New York, Los Angeles, and Seattle, and in Europe, South Africa, and Australia," Vice reported. "The images often include a small contingent (typically one to three) of masked, camo-clad men holding weapons standing in front of The Base's flag, a black flag with three white lines running down the centre."

Continue Reading
 
 

Thank you for whitelisting Raw Story!

As a special thank you, from now until August 31st, we're offering you a discounted rate of $5.99/month to subscribe and get ad-free access. We're honored to have you as a reader. Thank you. :) —Elias, Membership Coordinator
LEARN MORE
close-link
close-image