Jpmorgan Chase Case Summary

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JPMorgan Chase & Co. posted higher profit than Wall Street expected as higher credit-card spending and investment banking fees combined to overpower sliding revenue from bond-trading.

Earnings of $1.82 a share in the three months through June compared with the $1.59 average of analysts' estimates from FactSet, and net income rose 13% to $7.03 billion. Rising interest rates after two hikes this year by the Federal Reserve pushed net interest income -- the difference between what banks charge to borrowers and what they pay to depositors -- up 8% to $12.5 billion, JPMorgan said.

The bank joined New York-based Citigroup in beating Wall Street projections despite the drag from bond-trading. Citi's earnings of $1.28 a share compared with an average
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Investment banking fees climbed 10% to $1.8 billion, amid double-digit gains in stock underwriting, JPMorgan said, and revenue from advising on mergers and acquisitions rose 8%.

Still, months of high growth in fixed-income trading disappeared in the second quarter, with revenue of $3.2 billion down 19% from a year earlier, when trading volumes were boosted by Britain's surprise decision to leave the European Union.

The decline from the "Trump bump" in the first three months of the year was even larger, at 24%. Wall Street had benefited at the start of 2017 from promises of big tax cuts and a rollback of regulations following President Donald Trump's election in November, which spurred large bets on faster economic growth.

Now, as Trump's plan to overhaul healthcare laws stalls in Congress and key positions remain unfilled amid a steady drip of revelations about his campaign's interactions with Russia, the trading frenzy has stalled.

Overall, revenue from big banks' juggernaut bond-trading divisions probably tumbled 16% in the second quarter from a year earlier, according to Goldman Sachs Group Inc.

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