NEW YORK: JPMorgan Chase & Co’s better-than-expected first-quarter earnings raised expectations that rival Wall Street lenders would follow suit when they report next week, pushing most bank stocks higher on Friday. Shares in JPMorgan jumped as much as 4.7 per cent in morning trading, touching a more than four-month high before paring some gains. Morgan Stanley shares were up 3.8 per cent and Bank of America Corp rose 2.8 per cent. Goldman Sachs Group Inc and Citigroup shares both climbed 2 per cent.
JPMorgan is the largest US bank by assets and a bellwether for the US economy and financial sector. It reported strong results across its businesses, with Chief Executive Jamie Dimon citing solid US economic growth, moderate inflation and robust consumer and business confidence. Even a 10 per cent fall in JPMorgan’s trading revenue from a year earlier was viewed as boding well for others, since analysts had been bracing for a bigger drop in fixed-income and equities trading.
“JPMorgan had a positive read-across for trading results in the quarter,” said KBW analyst Brian Kleinhanzl. “We believe FICC (fixed income, commodities and currencies) trading should be a positive read-across to Goldman Sachs and Morgan Stanley.” Bank stock investors appeared to zero in on JPMorgan and ignore Wells Fargo & Co, the other big bank that reported on Friday. Wells Fargo reported higher first-quarter earnings but lowered its forecast for net interest income this year, a move that sent its shares tumbling as much as 3 per cent. — Reuters
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