JPMorgan’s Bad Earnings News Really Isn’t So Bad
Consumers and companies are continuing to borrow and spend despite recession fears. Investors are too focused on the negatives.
Still a lot to smile about.
Photographer: Chris Ratcliffe/Bloomberg
Recession fears are everywhere — except in the quarterly results of banks like JPMorgan Chase & Co. Financial markets are in a world of pain, but consumers and companies are borrowing and spending as if a threat of economic hurricanes was that last thing on their minds.
JPMorgan’s second-quarter results on Thursday, the first from the large US banks, were closely watched for any signs of debt-repayment problems. Not only were there none, but the bank raised its estimate for net interest income for the year to $58 billion — a $2 billion increase from its forecast of only two months ago. And yet JPMorgan’s stock was down more than 3%. Shares of Morgan Stanley, which also reported second-quarter results, were 1% lower, and those of Bank of America, which reports on Monday, were off more than 2%.