JPMorgan’s big earnings beat drives biggest bank stock gains of 2024

And so it begins. JPMorgan Chase got a big bump this morning after unofficially opening the spigot on the flow of Q3 earnings reports this morning.

The nation’s largest bank by assets posted a better-than-expected profit of nearly $13 billion, driven in part by a healthy spread between what it pays to borrow and what it charges to lend, a key metric known as its net interest margin.

On the downside, its earnings were curtailed slightly by a rise in the amount of loan losses — driven by credit cards — it recognized and an increase in the amount of money it set aside to cover potential losses going forward. That total stash rose to $3.1 billion, up from $1.4 billion over the same period last year.

JPM gets special attention from the market not only because of its primus inter pares position in earnings season, but also because its vast scale should, in theory, give JPM executives a level of visibility into the economic behavior of a large chunk of the American populace, potentially allowing them to suss out economic trends early.

On that front, JPM CFO Jeremy Barnum basically said all signs indicate that the US consumer continues to plow forward, despite the supposedly downbeat mood that economic surveys — like the one just released this morning — consistently show.

“We see the spending patterns as being sort of solid and consistent with the narrative that the consumer is on solid footing, and consistent with a strong labor market,” he told analysts.

JPM wasn’t the only bank to report today. Good numbers from Wells Fargo also put it on track for its second-best daily gain this year, after the fees it charges for investment banking pushed its bottom line results above Wall Street’s expectations.

Banking stocks as a group also bounced, with a well-watched index of bank shares, the Invesco KBW Bank ETF, posting its biggest intraday gain of the year.