JP Morgan shares rise as strong consumer trading boosts third-quarter profit
Shares in JP Morgan rose almost 2.5 per cent this afternoon after strong trading in its consumer division helped drive third-quarter profit growth.
The bank posted net profit of $9.1bn (£7.2bn) or $2.68 per share, up eight per cent on last year and ahead of analysts’ estimates. Revenue also rose eight per cent to hit $30.1bn.
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JP Morgan posted revenue growth in three of its four business divisions. Only commercial banking suffered a decline, as low interest rates took their toll on trading.
The positive growth was driven largely by a boost from the bank’s consumer customers, with increased revenue from home lending, car financing and credit cards.
“The consumer remains healthy with growth in wages and spending, combined with strong balance sheets and low unemployment levels,” said chairman and chief executive Jamie Dimon.
“This is being offset by weakening business sentiment and capital expenditures mostly driven by increasingly complex geopolitical risks, including tensions in global trade.”
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The Federal Reserve’s recent move to cut interest rates has sparked concerns that banks’ earnings could take a hit. Despite this, JP Morgan’s net interest income ticked up two per cent to $14.4bn.
Neil Wilson, chief market analyst at Markets.com, said: “Coming into this season net interest income was the number one metric to focus on, as banks have been forced to trim their expectations for where US interest rates will be.”
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