For years, Wall Street’s top bankers have watched with a mix of envy and exhaustion as power, profits and popular imagination shifted westward to Silicon Valley.
But some of the biggest lenders in America reported strong quarterly earnings on Tuesday along with increasing — if tentative — optimism that the U.S. economy has more room to run. The reports were a reminder that while President Trump’s topsy-turvy trade policies have roiled many industries, in the world of high finance, uncertainty is often a chance to make money.
JPMorgan Chase, the largest bank in the country, exceeded forecasters’ expectations for profitability, earning about $15 billion in the second quarter. Importantly, its haul from advising on corporate deal making, which had been expected to decline amid uncertainty over global trade, rose. The bank credited a shift in momentum as the most extreme of Mr. Trump’s tariffs were repeatedly delayed.
JPMorgan’s chief executive Jamie Dimon, whose words are carefully parsed on Wall Street, suggested a greater degree of optimism in his prepared remarks. While his remarks in the first quarter called out “considerable turbulence (including geopolitics)” in the economy, on Tuesday he flipped to saying that the economy was “resilient” and that “the finalization of tax reform and potential deregulation are positive for the economic outlook.”
JPMorgan’s stock has gained more than 20 percent this year, far outperforming the S&P 500, which has risen about 6.5 percent.
Wells Fargo also reported earnings on Tuesday, announcing a profit of $5.5 billion, up 12 percent from the same quarter a year ago. Last month, the Federal Reserve freed the bank from the asset cap that had constrained it for seven years — a penalty regulators imposed in response to the bank’s sham accounts scandal and other misdeeds.
More lenders, including investment banks Goldman Sachs and Morgan Stanley, were slated to report earnings on Wednesday and expected to shed further light on the status of mergers and acquisitions, among other corporate activities.
Rob Copeland is a finance reporter for The Times, writing about Wall Street and the banking industry.
Stacy Cowley is a business reporter who writes about a broad array of topics related to consumer finance, including student debt, the banking industry and small business.
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