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Q3 trading flops

Wall Street took its lumps on Thursday after two large banks reported weak thirdquarter trading.

The results from JPMorgan Chase and Citigroup spooked investors and siphoned off value from each of the large banks.

JPMorgan, the largest US bank, saw a huge 27 percent drop in bond trading revenue, to $3.1 billion, compared with the same period last year. That’s worse than a slump of about 20 percent that Dimon had signaled at a conference a month ago.

Overall, the bank’s profits rose 7 percent on higher lending, to $6.7 billion.

Citi, which has been the best-performing major bank this year, reported a more modest 11 percent decline in trading, to $3.6 billion, with bond trading off 16 percent.

Last month, Citi financial chief John Gerspach had warned of a 15 percent trading decline.

The bank, led by CEO Michael Corbat, made up for the trading drop with a 14 percent increase in investment banking revenue, to $1.2 billion.

Wall Street’s CEOs had previously warned analysts that trading was going to be down for the three months ending in September, as calm mar- kets and stable interest rates quash any reasons to buy or sell.

The meh results sent JPM shares down 85 cents, to $95.99, and Citi’s shares down 3.4 percent, to $72.37.

Wells Fargo, Morgan Stanley and Bank of America each were down slightly.

Even with the tepid results, JPMorgan reported record revenue in commercial banking and in assets in its wealth management business — signs, the bank says, of a strengthening economy.

The earnings came a day after NBC published an op-ed by Dimon calling for lowering taxes on businesses, arguing that it would ultimately lead to more jobs and higher wages for workers.

When pressed during a morning call, Dimon declined to pledge to raise wages for his own workers if the Trump administration cuts taxes for businesses like JPMorgan.

“Well, that’s not the way to look at it,” he said, noting that they had raised wages for lower-paid workers previously.

JPMorgan spokesman Joe Evangelisti said that the company already pays its workers competitively.

“Over time, yeah, we probably would be boosting jobs and wages more than we otherwise would have,” Dimon added later.