JPMorgan Chase CFO Forecasts Drop in Trading Revenue for Q1

Jeremy Barnum, CFO of JPMorgan Chase (JPM.N), has projected a decline of 5% to 10% in trading revenue for the first quarter compared to the robust performance seen in the previous year. The announcement comes as the largest lender in the U.S. braces for potential headwinds in market activity amidst ongoing volatility.

In the first quarter of the previous year, JPMorgan reported a total markets revenue of $8.4 billion, setting a high bar for comparison. Barnum attributed the anticipated dip in trading revenue to factors such as the relative strength observed in equities and macro markets in the preceding year, emphasising that the expected performance decline is consistent across various asset classes.

Addressing investors at a conference in Miami, Barnum acknowledged that while both equities and macro markets demonstrated resilience in the previous year, market conditions have evolved, leading to a more subdued outlook for the current quarter.

In addition to the tempered trading revenue forecast, Barnum expressed expectations of a slightly weaker IPO market compared to initial projections. However, he offered a contrasting outlook for investment banking fees, forecasting a rise in the low-to-mid teens percentage range for the first quarter, underscoring the bank’s diversified revenue streams and resilience amidst market fluctuations.

JPMorgan CEO Jamie Dimon echoed sentiments of cautious optimism regarding market sentiment, noting improvements in equities and mergers and acquisitions. Despite these positive indicators, Dimon maintained a prudent stance regarding the broader economic outlook, reflecting uncertainties stemming from geopolitical tensions and inflationary pressures.

As JPMorgan navigates the evolving market landscape, the bank remains vigilant in managing risks while capitalising on emerging opportunities. The anticipation of a decline in trading revenue underscores the dynamic nature of financial markets and the importance of adaptability in sustaining growth and resilience in the face of uncertainty.