JPMorgan Chase and Wells Fargo were among the winners on Wednesday’s stock exchanges in New York. Both American banks saw their profits rise more than expected last quarter.
JPMorgan Chase, the largest bank in the United States, benefited from the continued strong American economy and did exceptionally well with its investment activities. For example, the bank earned more from supervising mergers and acquisitions and the issuance of shares and bonds by companies. Over 2024, JPMorgan booked a record profit of 58.5 billion dollars. The share price was set at 0.5 percent higher.
Wells Fargo, the fourth largest American bank, also saw its income from its business activities rise sharply. The bank also expects a more substantial than expected increase in net interest income in 2025, or the difference between the interest the bank receives on loans and the interest paid on savings accounts. That share rose by almost 5 percent.
The general mood on Wall Street was also upbeat after Tuesday’s mixed closing. The Dow Jones index was up 1.4 percent shortly after the market opened at 43,110 points. The broad S&P 500 index gained 1.3 percent to 5915 points, and the tech benchmark Nasdaq gained 1.5 percent to 19,333 points.
The shares of American banks have already risen considerably since Donald Trump was re-elected in November last year. Investors hope that the incoming American president’s policies, such as tax cuts and flexible regulations, will boost the financial sector.
Investment bank Goldman Sachs also booked a higher profit than expected last quarter and was rewarded with a 5 percent price gain. BlackRock also opened its books. The world’s largest asset manager posted higher earnings than expected last quarter, and its share price rose by almost 5 percent. Morgan Stanley and Bank of America, which will report results on Thursday, gained practically four and nearly 3 percent, respectively.
In addition to the quarterly figures from the American banks, the December inflation figure for the United States was also announced. As expected, consumer prices rose by 2.9 percent in the last month of 2024. Inflation plays a vital role in interest rate policy. If inflation is higher than expected, the Federal Reserve may become more cautious about lowering interest rates.
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