Rising opening for the Dow Jones, which rises to 24.60, gaining 0,3%. The attention of investors was focused on the quarterly data of the main US banks, largely positive results.
However, the euphoria linked to the excellent performance recorded by three of the main US banks – JP Morgan Chase, Wells Fargo and Citigroup – must also be viewed from another perspective: the first quarter results benefited from a lower tax rate, due to tax reform approved by Congress at the end of the year (while the fourth quarter of 2017 was negative due to the adjustments related to the new tax regime).
Profits up in Q2018 XNUMX for JP Morgan Chase, which recorded an exhilarating +35,1%, thanks to higher interest rates and lower taxes. Net income rose to $8,71 billion, compared with $6,45 billion in the same period in 2017.
For the banking institution headed by Jamie Dimon costs increased 5% to $16,1 billion from $15,3 billion in the same period in 2017. According to estimates by the US bank, total costs are expected to rise to about $62 billion at the end of the year, from 58,5 billion in 2017.
Roe came in at 15%, up from 11% a year ago, while revenue from trading activities increased 13% to $6,57 billion from $5,82 billion a year earlier.
Positive results also for Wells Fargo, which recorded rising profits and falling revenues, however beating analysts' estimates in both cases.
The San Francisco bank closed the first quarter with net income of $5,9 billion, up 5,3% from $5,6 billion in 2017, but down from $6,2 billion in the fourth quarter. 2017, when he had enjoyed the effect of the tax reform wanted by President Donald Trump.
Earnings per share moved to $1,12 from $1,03, above analysts' expectations for $1,06. Revenues fell 1,8% to $21,9 billion, but analysts expected a drop to $21,7 billion.
However, as stated in a note from the Bank, the accounts are "subject to change" due to a series of ongoing discussions with the US authorities on issues relating to "the compliance of the risk management programme, past practices relating to certain auto insurance policies and others linked to interest rates on mortgages”.
Two months ago, Wells Fargo was fined by the Federal Reserve over "widespread consumer abuse": the central bank is preventing the group from growing its assets beyond the $1.950 trillion it had at the end of 2017. In September 2016, the bank paid a $185 million fine for opening up to 3,5 million unauthorized checking accounts. The opening title in New York is bad: loses 1,5%.
Profits and revenues growing in the first quarter of 2018 also for citigroup. 4,6 billion dollars in net income, after the 4,1 billion obtained in the same period of 2017, and revenues up 3% to 18,87 billion dollars, as expected by analysts, against the 18,37 billion of a year earlier, buoyed by the recovery in credit and consumer banking.
The US big bank reported earnings per share of $1,68, above the $1,61 estimates by analysts.
