America's big banks beat their forecasts, and Citigroup still fell 5.6%

Citigroup

Citigroup fell 5.6% to US$124.53 on Tuesday. It earned US$2.85 a share in the September quarter, well ahead of the US$2.66 analysts expected.

The trouble was the month of September. JPMorgan Chase finance chief Jeremy Barnum said the bank saw deal-making slow during the month. Wells Fargo's finance chief, Mike Santomassimo, said trading activity slowed meaningfully. Wells shares lost 3.1% after its net interest income came in short of estimates.

Citi's outlook did the most damage. It told analysts to expect markets revenue about 20% lower in the December quarter, possibly a bit more. Its return on tangible equity, a measure of profit on shareholders' money, fell to 11.5% from 13% in the June quarter.

Chart: JPMorgan missed, and still out-earned last September. Diluted earnings a share in each September quarter since 2008, in US$. This quarter's US$5.57 fell short of the US$5.85 analysts expected. — This story’s chart of the day: the numbers, the dark version and the animated version are on its own page. The chart’s page →

JPMorgan missed outright. It earned US$5.57 a share against expectations of US$5.85, its first profit miss since late 2023. Investment banking fees were 14% higher than a year earlier but 8% lower than in the June quarter, and the shares fell 0.86%.

Goldman Sachs had the strongest quarter of the lot. Revenue rose 23% to US$18.68 billion and stock trading revenue jumped 72%. Its shares still slipped 0.2%.

What to watch

whether September was a pause. Barnum called the missing deals delayed rather than cancelled. With the 10-year Treasury yield still above 5%, I'd want to see the listings calendar fill up again before taking that on trust.

This story ran in The September Slowdown Wednesday 14 October’s edition, with the market snapshot, the other two stories, the numbers and the week ahead. Read the whole edition →

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Monday 12 October America's big banks report this week, and their shares are down 13% since August

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