JPMorgan Chase & Co. (NYSE:JPM): Its Latest Outlook Shivered The Street


Dallas, Texas 05/06/2014 (FINANCIALSTRENDS) – JPMorgan Chase & Co. (NYSE:JPM) recently reported its latest outlook in the quarterly filings with the SEC (Securities and Exchange Commission). The company reported that it anticipates 2Q14 market revenues to be declined by close to 20% on a year over year basis. Based on the market revenues results to date, the company expects 2Q14 market revenue to be around $4.3 billion. Following the filing, the stock the stock fell by 2.45% and closed at $54.22.

Factors Affecting Market Revenues

The company attributed this decrease to lower client activity and continually challenging overall economic environment. The bank has already reported 17% decline in its market revenue during 1Q14 as compared to 1Q13. The company attributed downward trend being witnessed in Fixed Income Markets as the primary reason for continued decline in market revenues. JPMorgan Chase & Co. (NYSE:JPM) reported 18% decline in its Fixed Income Markets during 1Q14 as compared to 1Q13. In addition, the Federal Reserve’s decision to taper bond buying is also contributing to declining market revenues. Further, given the customer sentiments in the challenging economic environment, equity income is also declining. The company reported 3% decline in its equity income during 1Q14 as compared to 1Q13.

A Warning Bell for Banking Industry:

JPMorgan Chase & Co. (NYSE:JPM)’s latest outlook and continued decline in market revenues are seen by the experts as a warning bell for other banks. Despite market revenue is a result of different component mixes and could vary from bank to bank depending on their product and services portfolio, it is seen that all the major U.S. banks have been steadily facing a pressure and include, Citigroup Inc. (NYSE:C), Bank of America Corp (NYSE:BAC), Morgan Stanley (NYSE:MS) and Goldman Sachs Group Inc. (NYSE:GS).

Equities Research Analysts at Zacks noted, “We expect JPMorgan to remain continually pressurized by lackluster consumer and corporate activities, soft trading volumes and sluggish mortgage banking in the near term. Though cost containment efforts are noticeable, fundamental pressure from a low interest rate environment and sluggish loan growth will likely be a persistent drag for the top line growth.”

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