By Elizabeth Dilts and Siddharth Cavale
Its shares fell 1.3 percent to $99.61 in early trading as the lender posted declines in revenue in three of its four main businesses in the fourth quarter.
Overall adjusted fixed income trading revenue fell 18 percent as investors fled commodities and credit trading markets due to spikes in volatility toward the end of 2018. Equities trading revenue rose 2 percent from a year earlier, helped by strength in prime brokerage, which serves hedge fund clients.
JPMorgan Chief Financial Officer Marianne Lake told reporters on a conference call that one down quarter in fixed income does not mean a trend and that the trading environment had improved by the start of the year.
"It is too early to call it, but a decent start to January," she said. Volatility can help boost trading activity, but sharp spikes can drive customers to the sidelines and hurt the bank's own market exposure.
Citigroup Inc on Monday blamed its own sharp drop in fixed income revenue on widening credit spreads, or the premium investors demand for holding corporate bonds over safer U.S. Treasury securities, during the year-end volatility.
Investment banking revenue rose 3 percent on higher advisory fees, even as underwriting fees declined.
Revenue in asset and wealth management fell 5 percent as market declines translated into lower asset levels and management and performance fees.
Trading desks at banks have been shaken by global growth concerns and the ongoing trade war between the United States and China. Bank stocks underperformed the S&P 500 index in 2018 by 13 percent.
"As we head into 2019, we urge our country's leaders to strike a collaborative, constructive tone, which would reinforce already-strong consumer and business sentiment," Chief Executive Officer Jamie Dimon said in a statement.
JPMorgan said expenses rose 6 percent, outpacing revenue growth as it invested in technology, marketing and real estate.
Net income increased 67 percent to $7.07 billion, or $1.98 per share, from a year ago, when it took a one-time charge due to the U.S. tax overhaul. But it missed analysts' average estimate of $2.20 per share, according to IBES data from Refinitiv.
Net interest income was up 9 percent to $14.5 billion on higher interest rates in 2018.
The bank's average core loan book grew 6 percent from the year-earlier quarter.
Revenue rose 4.1 percent to $26.80 billion, shy of the average analyst expectation of $26.83 billion.
Well Fargo & Co on Tuesday reported fourth-quarter revenue that missed analysts' estimates as revenue across all its banking units declined, especially at community banking.
(Reporting by Siddharth Cavale; Additional reporting by David Henry; Writing by Meredith Mazzilli; Editing by Saumyadeb Chakrabarty and Jeffrey Benkoe)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)