JPMorgan profit rises on dealmaking, stock trading windfall

JPMorgan Chase reported a higher second-quarter profit on Tuesday as its investment banking business benefited from a surge in big-ticket deals, while its traders capitalized on volatile markets.

The largest U.S. lender posted a profit of $21.2 billion, or $7.70 per share, in the three months ended June 30, compared with $14.99 billion, or $5.24 per share, a year earlier.

The value of global mergers and acquisitions announced so far this year has surpassed $3 trillion, according to Dealogic data, adding momentum to one of banks’ biggest fee-generating businesses: advising on deals.

While volatility sparked by the Iran conflict and concerns that AI could disrupt traditional software companies dented sentiment briefly and slowed dealmaking, investor appetite recovered quickly.

“The U.S. economy has demonstrated notable resiliency this year, with stronger business investment and hiring,” JPMorgan CEO Jamie Dimon said in a statement.

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“This strength is being supported by several tailwinds, including AI-driven capital investment, fiscal stimulus and the benefits of more efficient regulation.”

Shares of the bank rose 1% in premarket trading after the results.

Dealmaking boom

JPMorgan retained the top spot in global investment banking league tables, generating the highest investment banking revenue in the industry, according to Dealogic data.

Meanwhile, the U.S. IPO market has staged a broad-based recovery after years of drought, led by Elon Musk’s SpaceX, whose more than $2 trillion debut marked the largest listing in history. JPMorgan was a joint book-running manager on the offering.

The recovery also gave private equity and venture capital firms more avenues to exit investments through company sales and public listings.

JPMorgan’s investment banking fees increased 30% in the second quarter from a year earlier, higher than the bank’s earlier estimate.

It was part of several landmark transactions during the quarter, including as co-adviser on NextEra Energy’s $67 billion merger with Dominion Energy and lead active bookrunner on Alphabet’s $85 billion equity offering.

Stock trading windfall

Markets remained volatile during the quarter as the conflict in the Middle East and disruptions to shipping through the Strait of Hormuz rattled investors and drove swings across asset classes.

The jump in oil prices also rekindled concerns about inflation, prompting investors to reassess the outlook for Federal Reserve interest-rate cuts.

JPMorgan’s equity trading revenue surged 86%, while fixed-income trading revenue increased 6%.

The recovery in investment banking has coincided with elevated market volatility, giving Wall Street banks a boost across both businesses.

Stronger dealmaking and equity issuance have supported fees, while active client trading has lifted markets revenue.