US banks kick off Q4 earnings

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JPMorgan Chase Q4 estimates

JPMorgan set to report earnings of $3.53 per share, down 0.7% on the same quarter a year ago. But, revenue is expected to rise by 11.8% to $39.8 billion, boosted by the ongoing integration of First Republic Bank into its business. In the last twelve months, JPMorgan performed better than its US peers, gaining around 27% in the period. Since the very end of October, JPMorgan shares have risen consistently, setting a new all-time high last Thursday.

Bank of America outlook

On the other end of the spectrum is Bank of America. EPS is anticipated to fall by nearly 20% to 68 cents. Revenue is also expected to decline 2.6% to $24 billion. The Bank of America chart has lagged the broader industry, only gaining 0.9% in 2023. An underperformance partly due to a slower recovery from the March 2023 US banking turmoil. That said, the stock has gained 37% since the end of October and now trades at a ten-month high.

Challenging 2024 outlook for US banks

Also due to report before the bell is Citigroup, and Wells Fargo, then Goldman Sachs and Morgan Stanley report on Tuesday 16 January. According to Deloitte's 2024 Banking And Capital Markets Outlook, this year may be a challenging year. Slowing global economy, interest rate cuts and continued geopolitical tensions, as many factors that could affect financial services companies. Investors also are keen to know how the banking sector will align with the arrival of new technologies. As Deloitte notes, the adoption of generative artificial intelligence alone will add layers of risk, and the market can expect an increase in capital spending.