—— JPMorgan Investment Banking Fees Up 50%; US PPI Rises Slightly More Than Forecast; Biden Misspoke Multiple Times in NATO Speech; Hackers Accessed Data of Nearly All AT&T Customers; Unilever to Cut One Third European White Collars; Bitcoin ETFs See Record Inflows as Dip Buyers Return; Citigroup Revenue Gains in All Five Divisions
1. JPMorgan Investment Banking Fees Up 50%
JPMorgan Chase & Co. reported record profits as investment bankers and equities traders at the largest US bank exceeded expectations, bolstered by a multibillion-dollar gain from a Visa Inc. share exchange.
With more businesses resuming deals after a prolonged lull, investment bankers are significantly enhancing their banks’ bottom lines despite the elevated cost of borrowing, ongoing uncertainty from the US election, and global geopolitical issues. “There has been some progress in reducing inflation, but numerous inflationary pressures remain: large fiscal deficits, infrastructure demands, trade restructuring, and global remilitarization,” Chief Executive Officer Jamie Dimon said in a statement on Friday. “As a result, inflation and interest rates may remain elevated longer than the market anticipates.”
Investment banking fees soared past analysts’ estimates, increasing by 50%, while the firm’s equity traders achieved a 21% revenue jump. The Visa transaction contributed $7.9 billion to the second-quarter profit.
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2. US PPI Rises Slightly More Than Forecast
US producer prices climbed slightly more than expected in June, driven by an increase in margins at service providers, which offset a second consecutive month of declining goods costs.
The producer price index (PPI) for final demand rose 0.2% from the previous month, according to data from the Bureau of Labor Statistics released on Friday. On an annual basis, the PPI increased by 2.6%.
This report on wholesale inflation follows the consumer price index (CPI) report, which showed the first decline since the onset of the pandemic. The CPI report has set the Federal Reserve on a potential path to start lowering interest rates as early as September.
The PPI report indicated that service costs increased by 0.6%, with nearly all the rise attributed to a 1.9% increase in margins at wholesalers and retailers. Meanwhile, goods prices decreased by 0.5%.
Excluding food, energy, and trade—elements that introduce more volatility—the less-volatile measure preferred by many economists showed no change from the previous month. Compared to a year ago, this gauge moderated to a 3.1% increase.
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3. Biden Misspoke Multiple Times in NATO Speech
Joe Biden vowed to remain in the US presidential race and defended his fitness for office during a high-stakes press conference. However, he did not stop the calls from Democratic lawmakers urging him to end his re-election campaign.
During the press conference, Biden mistakenly referred to Kamala Harris as “vice-president Trump,” a gaffe that fueled further calls for his exit from the race.
Speaking at the conclusion of the NATO summit in Washington on Thursday, Biden asserted that he was the best candidate to defeat Donald Trump in November and believed he had time to recover from what he termed the “stupid mistake” of his poor debate performance two weeks ago.
“I beat him once, and I’ll beat him again,” Biden, 81, said of his 78-year-old predecessor and Republican rival. “There’s a long way to go in this campaign, I’m just going to keep moving.”
The press conference, watched globally for signs of the president’s fitness, featured Biden demonstrating his understanding of global affairs with detailed responses on Ukraine and Israel.
However, critics focused on his errors, including introducing Ukrainian President Volodymyr Zelenskyy as “President Putin” and stating he was “following the advice of my commander-in-chief” regarding Ukraine policy.
Shortly after Biden left the stage, another senior Democrat in the House of Representatives, Connecticut’s Jim Himes, called on him to step aside. He was quickly followed by Eric Sorensen from Illinois and Scott Peters of California.
Source: Financial Times – Joe Biden vows to ‘complete the job’ despite stumbles in press conference
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4. Hackers Accessed Data of Nearly All AT&T Customers
AT&T experienced a major cybersecurity breach earlier this year, with hackers gaining access to the call and text message information of “nearly all” of the US telecom company’s tens of millions of wireless subscribers.
Over an 11-day period in April, “threat actors” accessed and copied records of customer calls and texts from several months in 2022 and January 2, 2023, according to a regulatory filing by the company on Friday. The compromised data included files related to “nearly all” of its cellular customers, customers of mobile virtual network operators (MVNOs) using its wireless network, and AT&T’s landline customers who interacted with those cellular numbers between May and October 2022. The breach on January 2 affected “a very small number of customers.”
Based in Dallas, AT&T joins a growing list of major US companies that have faced cybersecurity breaches over the past year. This list includes healthcare giant UnitedHealth, consumer group Clorox, casino operators MGM Resorts International and Caesars Entertainment, and Supreme and North Face owner VF Group.
As of the end of March, AT&T reported having more than 100 million wireless subscribers, making it the second-largest wireless carrier in the US by customers and revenue, following Verizon.
AT&T launched an investigation after learning about the breach on April 19. The US Department of Justice determined in May and June that delaying public disclosure of the breach was “warranted.”
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5. Unilever to Cut One Third European White Collars
Unilever plans to eliminate a third of all office roles in Europe by the end of next year, as part of the company’s new chief executive’s strategy to stimulate growth at the struggling consumer goods giant.
The FTSE 100 company, which is under pressure from shareholders including activist investor Nelson Peltz, informed senior executives on Wednesday that up to 3,200 roles would be cut in Europe by the end of 2025. This information was shared during a company-wide call, according to details obtained by the Financial Times.
These job cuts are part of Unilever’s “productivity programme” announced in March, which includes slashing up to 7,500 roles globally. The company currently employs between 10,000 and 11,000 office-based staff in Europe.
“The expected net impact in roles in Europe between now and the end of 2025 is in the range of 3,000 to 3,200 roles,” said Constantina Tribou, chief human resources officer, during the video call.
The specific locations of the job cuts across Europe have not yet been formally decided. Unilever, which has its headquarters and primary listing in London after abandoning its Anglo-Dutch structure in 2020, stated that a consultation process with affected employees will begin in the coming weeks.
Tribou emphasized that the cuts would “primarily apply to office-based roles” and would not affect factory-based jobs.
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6. Bitcoin ETFs See Record Inflows as Dip Buyers Return
After the price of the world’s largest cryptocurrency, Bitcoin, dropped to its lowest level since February a week ago, dip buyers returned significantly, resulting in the best inflows for Bitcoin exchange-traded funds (ETFs) in over a month.
Spot Bitcoin ETFs attracted $882 million during the week ending July 11, with an average of $175 million coming in per day, according to data from JPMorgan. These are the most substantial inflows since the period ending May 23.
BlackRock and Fidelity’s Bitcoin funds led the surge, receiving $403 million and $361 million, respectively. In contrast, Grayscale’s ETF continued to experience outflows, losing almost $87 million.
This marked the second consecutive period of fund growth, with the prior week seeing $166 million in inflows, breaking a three-week streak of outflows that saw Bitcoin ETFs lose over $1.1 billion.
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7. Citigroup Revenue Gains in All Five Divisions
Citigroup Inc. announced that its costs for the year are now expected to be at the high end of the previously provided range after the bank faced several regulatory penalties in recent months.
In the second quarter, Citigroup managed to reduce expenses by 2% to $13.35 billion, slightly better than the $13.4 billion average of analyst estimates compiled by Bloomberg.
However, for the full year, expenses are now likely to reach the higher end of the previously projected range of $53.5 billion to $53.8 billion, the New York-based bank said on Friday. The bank recorded $56.4 billion in costs for 2023.
This tighter guidance indicates that the bank’s efforts to cut costs may not be as straightforward as investors had hoped, as Citigroup continues with a major transformation plan under Chief Executive Officer Jane Fraser.
This effort, partly in response to a pair of consent orders from the Federal Reserve and the Office of the Comptroller of the Currency in 2020, has faced challenges due to regulatory issues and other operational missteps by Citigroup.
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本文内容来自《Financial Times》、《Bloomberg》，以及《The Real Deal》等多家财经新闻媒体。