JPMorgan Chase kicked off bank earnings season Thursday by topping second-quarter estimates with a profit of $1.55 per share, compared to estimates of $1.43 a share, sending shares higher in trading.
The bank also reported better-than-expected revenue of $25.2 billion. Investors are closely watching U.S. bank earnings to see if their performance in the second quarter avoided pain from turbulence in the European Union and other factors that have hampered Wall Street banks this year.
JPMorgan shares rose more than two percent Thursday morning after the market opened. The Dow rise more than 100 points at the open Thursday as well. Get the latest JPMorgan stock quote here.
"JPMorgan Chase continued to perform well in all of our major businesses," CEO Jamie Dimon said in a statement Thursday morning. "Outside of energy, both wholesale and consumer credit quality remained very good."
In his statement, Dimon credited rising consumer deposits, credit card sales and lending for boosting JPMorgan's earnings.
A consensus of 28 analysts who follow the bank had forecast a profit of $1.43 a share, with projections spread in a range from $1.34 to $1.54 a share. Analysts also projected revenue of about $24.16 billion. In the comparable period last year, the bank reported second-quarter earnings of $1.54 per share on revenue of $24.3 billion. In the first quarter of 2016, JPMorgan beat top- and bottom-line expectations with revenue of more than $24 billion and earnings per share of $1.35.
Other banks' stocks also rose Thursday morning. One analyst suggested that it could be a sign Wall Street is doing a better job of coming to grips with continuing realities enforced on banks by central banks in the U.S. and abroad.
"The banks have been living with lower-for-longer interest rates," David Hilder, Drexel Hamilton senior equity research analyst, said Thursday morning on CNBC. "The banks, led by JPMorgan, have arranged themselves for the continuing economic environment."
Earlier this week, Dimon joined the ranks of executives enacting higher wages for low-ranking staffers, calling it "a fair opportunity to get ahead." In its Thursday earnings report, the bank also reported a slight increase in headcount, a reversal of recent trends at the bank and elsewhere on Wall Street. The bank also reported a small increase in compensation, a welcome sign for bankers and traders who saw comp cut in the beginning of the year.
In the wake of a turbulent first quarter this year, banks reduced headcount once again to offset the fall in capital markets and trading that hurt their top lines. But, after that, JPMorgan corporate and investment bank CEO Daniel Pinto suggested job cuts on Wall Street were nearing an "end of the cycle of contraction."
JPMorgan stock, like most banks' shares, have struggled in 2016 after first taking a hit from falling commodity prices and their exposure to loans dependent on commodities, and more recently, by economists backing off predictions that central bankers in the U.S. and around the world would raise interest rates.
Fund manager BlackRock also reported results Thursday morning, matching earnings expectations.