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JPMorgan's Trading Revenue Is on Pace to Jump, Pinto Says

Updated on
  • First-quarter investment-banking revenue seen slightly higher
  • ‘The year has started well,’ bank’s trading chief says
Bloomberg Intelligence’s Alison Williams reports on JPMorgan’s profit outlook.

JPMorgan Chase & Co.’s trading revenue is on pace to increase by “mid to high single digits” in the first three months of 2018, with a spike in market volatility poised to help Wall Street firms break a three-quarter slump in that business.

“Clearly, the year has started well,” Daniel Pinto, who oversees the trading and investment-banking unit of the largest U.S. bank, said Tuesday. He cited currencies and equities as particular areas of strength in response to a question from an analyst at the firm’s annual investor day.

Volatility is back in markets, as U.S. stocks experienced their worst single-day plunge in almost seven years earlier this month and 10-year Treasury yields reached the highest level in more than four years. While the wild run may have unnerved ordinary investors, for large banks it represented the possible end of a preternatural calm that weighed on results in 2017.

Read more about the volatility jolt giving traders a boost

Pinto, 55, said first-quarter investment-banking revenue for the industry is on pace to be unchanged or slightly up from a year earlier.

The bank said earlier Tuesday that annual profit could increase by $7 billion in coming years from rising U.S. interest rates and accelerating loan growth. The U.S. tax overhaul will boost return on tangible common equity by as much as 3 percentage points, according to the company.

JPMorgan fell 0.4 percent to $118.30 at 2:55 p.m. in New York, leaving the shares up almost 11 percent for the year. The KBW Bank Index dropped 0.3 percent and is up 7.4 percent for the year.

(Updates with FX, equities in the second paragraph.)
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