JPMorgan stock jumps after Jamie Dimon talks consumer power

  • JPMorgan jumped 8% on Monday after the company raised its net interest income forecast for 2022.
  • JPMorgan CEO Jamie Dimon spoke about consumer strength and said the economy could avoid a hard landing at its annual Investor Day.
  • Dimon’s upbeat comments helped other banks’ shares rise significantly in Monday’s trades.

JPMorgan shares jumped 8% on Monday after the bank’s annual investor day, during which its CEO Jamie Dimon made positive comments about the consumer.

The largest U.S. bank told investors on Monday it now expects net interest income of at least $56 billion for 2022, an increase of $3 billion from its previous forecast. It raised its earnings forecast on what it sees as very strong consumption despite the continued rise in interest rates and rising inflation.

Last month, Dimon said on JPMorgan’s first-quarter earnings call that “the storm clouds on the horizon might disappear, but they don’t.” Today, Dimon reiterated that view, but pointed out that these “storm clouds” may actually dissipate and not lead to a big problem like they did in 2008. .

Jamie Dimon said the US economy remains strong and potential obstacles to growth are not set in stone.

“Strong economy, big storm clouds. I call it storm clouds because they are storm clouds. They can dissipate. If it was a hurricane, I would tell you,” Dimon said. And if a


recession

finally materializes in the economy, it would be different from others thanks to very high consumption, according to the company.

JPMorgan’s credit outlook is strong, with net charges at an all-time high of 0.30% in 2021. As the bank expects net charges to recover to pre-pandemic levels going forward , a “strong consumer and wholesale balance sheet will delay normalization.” past 2022,” the bank said.

“The U.S. economy remains fundamentally strong, despite recent mixed data. [While] recent developments have increased the risk of a future adverse outcome, [our] Fortress principles are designed to withstand any operating environment,” the company said.

Positive comments from JPMorgan helped lift the broader financial sector and other major bank stocks in Monday’s trades. The financial sector rose 3.5%, while Morgan Stanley, Bank of America and Citigroup rose 4%, 6% and 7% respectively.

James T. Quintero