Here's the 'biggest single reason' gas prices hasn't hurt consumers, according to JPMorgan

By Tomi Kilgore

CEO Jamie Dimon sees elevated asset prices as a risk, along with wars, energy-price volatility and trade uncertainty, but not private credit

JPMorgan beat earnings expectations amid record market revenue, but a downbeat outlook for net interest income is hurting the bank's stock.

JPMorgan Chase beat first-quarter earnings expectations, with volatility from the Iran conflict leading to record market revenue and with consumers continuing to spend in the face of higher gasoline prices.

"The U.S. economy remained resilient in the quarter, with consumers still earning and spending and businesses still healthy," CEO Jamie Dimon said.

He said what was fueling that resilience was government stimulus resulting from last year's One Big Beautiful Bill Act, and the Trump administration's push to reduce regulations, as well as capital investments in artificial intelligence.

When asked on the post-earnings call with analysts about the health of the consumer at a time when the Iran conflict has led to a sharp increase in gas prices, Chief Financial Officer Jeremy Barnum said that although consumers are making some spending adjustments, it's not by enough to be visible. He offered a potential explanation.

Barnum noted that gas and energy costs represent about 3% of consumer expenditures. While that's "not nothing," it's also "not overwhelming," he said.

But the "biggest single reason" the consumer remains healthy in light of higher gas prices "is that the labor market is strong," Barnum said.

Dimon noted that higher tax refunds were also helping.

But he also warned of a "complex" set of uncertainties and risks to the outlook for markets and the economy, including the Iran conflict, global trade uncertainty, cybersecurity risks, rising energy costs and "elevated asset prices."

One thing that wasn't on Dimon's list of risks was private credit. He had said earlier this month that while losses in that market will likely be more than expected, he didn't see it presenting a systemic risk.

The stock (JPM) slipped 0.7% in recent afternoon trading, to an early premarket loss of as much as 3.4% seen soon after the earnings report was released. Even with Tuesday's decline, the stock has run up 10.1% since closing at an eight-month low on March 27.

Revenue for the latest quarter was up 10% from a year ago to $49.84 billion, to top the average analyst estimate compiled by FactSet of $49.13 billion.

Revenue for the commercial and investment-bank business jumped 18.9% to $23.38 billion, as markets revenue climbed 20% to a record $11.6 billion and investment-banking fees rose 28% to $2.9 billion.

Within markets, equity revenue increased 17% to $4.5 billion due to increased client activity, while fixed-income revenue surged 21% to $7.1 billion amid strength in the commodities, credit and currencies businesses.

Consumer- and community-banking revenue was up 6.9% to $19.57 billion, amid a 13% jump in revenue in the card service and auto business to $7.8 billion.

Net interest income rose 9% to $25.5 billion to match the FactSet consensus. But for 2026, the bank continues to expect net interest income of $103 billion, while the FactSet consensus has increased to $104.93 billion from $102.69 billion three months ago.

Earnings per share grew to $5.94 from $5.07, above the FactSet consensus of $5.45, while provision for credit losses dropped 24.1% to $2.5 billion, well below expectations of $3 billion.

The stock has lost 3.3% in 2026, while the State Street Financial Select Sector SPDR exchange-traded fund XLF has dropped 5.4% and the S&P 500 index SPX has gained 1.7%.

-Tomi Kilgore

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

04-14-26 1330ET