J.P Morgan profit falls

The drag of the European debt crisis on trading and corporate deal-making pulled down J.P. Morgan Chase & Co's profit, sending bank stocks tumbling on Friday, but the largest US bank by assets said the domestic economy was strengthening. Chief Executive Jamie Dimon said the New York-based bank was seeing signs of improvement in credit quality as well as loan demand from corporations and consumers in the United States.
"We see a mild recovery which actually might be strengthening, and it's broad," Dimon said in a conference call with reporters. "Hopefully, it will add to more jobs. We have seen jobs growing ... it's not enough but it could be self-sustaining." But Dimon sounded renewed alarm on the European debt crisis. "I would put myself in the 'increasing worried' category," he said.
His comments came shortly before a senior eurozone government source said credit rating agency Standard & Poor's was set to downgrade several euro zone countries, not including Germany, on Friday. The report sent the euro and US markets lower. J.P. Morgan shares fell 3.4 percent in morning trading on the New York Stock Exchange, lagging the KBW banks index, which was down 1.7 percent.
J.P. Morgan is the first major US bank to announce results for the fourth quarter. Its figures show Wall Street firms such as Goldman Sachs Group Inc and Morgan Stanley are in for a tough quarter as investment banking suffers. J.P. Morgan said fourth-quarter net income was $3.72 billion, or 90 cents a share, down from $4.83 billion, or $1.12 a share, a year earlier.
Wall Street analysts, on average, had expected 90 cents a share, according to surveys by Thomson Reuters I/B/E/S. Revenue declined 17 percent to $22.2 billion on an adjusted basis, missing the average Wall Street estimate of about $23 billion. Investment banking revenue fell 30 percent to $4.36 billion, hurt by a 39 percent drop in underwriting and advisory fees, a 13 percent decline in fixed income, and a 31 percent fall in equity markets.