Strong U.S. Bank Results Clouded by Trade War Uncertainty
Investors turned their attention to signals from the Federal Reserve and the trajectory of the ongoing trade war—two key factors expected to shape the second half of 2025.
America’s banking giants—J.P. Morgan Chase, Wells Fargo, and Morgan Stanley—reported strong first-quarter results for 2025, comfortably surpassing market expectations despite a backdrop of financial market volatility, an escalating trade war driven by the Trump administration, and mounting fears of a global recession.
J.P. Morgan Posts Record Revenue
J.P. Morgan Chase reported net income of $14.6 billion in Q1, up 9% year-over-year, and beat Wall Street forecasts with earnings per share (EPS) of $5.07, well above the expected $4.63. Total revenue reached $46 billion, up from $41.9 billion in the same period last year.
CEO Jamie Dimon highlighted the bank’s strong performance in markets, but cautioned about rising geopolitical tensions and tariffs weighing on the global economy. The bank set aside $3.3 billion in provisions for credit losses, repurchased $7 billion in stock, and raised its dividend by 12%.
From a technical standpoint, J.P. Morgan shares have shown a bearish trend since February, closing Thursday at $227.11, down 3.09% for the day. Analysts warn that unless the stock breaks above the $250 mark, further weakness could follow.
Wells Fargo Outperforms
Wells Fargo also exceeded expectations, reporting net income of $4.89 billion, or $1.39 per share, beating the consensus of $1.23 per share. A 6% earnings increase was driven by stronger performance in investment banking and wealth management, despite a 6% decline in net interest income, which came in at $11.5 billion.
CEO Charlie Scharf voiced support for the administration’s review of trade barriers but flagged concerns over a slowing economy. The bank maintained its full-year net interest income guidance (1% to 3% growth) and cut expenses by 3% year-over-year, to $13.89 billion.
Investment banking fees jumped 24% to $775 million, boosted by notable deals such as the merger of Fubo and Hulu + Live TV. The bank also closed five consent orders this year, part of its ongoing effort to move past the 2016 fake accounts scandal.
Morgan Stanley Achieves Record Profits
Morgan Stanley posted net income of $4.3 billion ($2.60 per share), up 26% from a year earlier, as market volatility provided a tailwind. Revenue rose to $17.7 billion from $15.1 billion in Q1 2024.
Trading income from both equities and fixed income soared, fueled by volatility stemming from Trump’s tariff moves and the launch of the DeepSeek generative AI model in China. Investment banking revenue totaled $9 billion, while wealth management contributed $7.3 billion.
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