Wall Street rises as materials and crypto stocks offset continued bond sell-off
By Niket Nishant and Manya Saini
July 15 (Reuters) - Jamie Dimon’s two decades at the helm of JPMorgan Chase have rewritten industry record books and the Wall Street giant is now within striking distance of another landmark - becoming the first bank ever to be valued at $1 trillion.
Crossing the milestone will put the bank in a club stacked with tech heavyweights such as Tesla, Meta and Broadcom, while also raising investor expectations and leaving little room for missteps.
Here are a few charts that explain the bank’s rise:
THE FINAL STRETCH
A stellar earnings report on Tuesday propelled JPMorgan shares to a record high. The lender, which reported the highest profit in history by a U.S. bank, was last valued at around $919 billion, dwarfing rivals.
With dealmaking volumes set to end the year near the record haul of 2021, JPMorgan could see elevated investment banking activity for the rest of 2026, which may nudge it closer to the $1 trillion mark.
CFO Jeremy Barnum said investment banking pipeline was robust, as "the current activity levels seem to be encouraging more activity".
NO EQUAL
With a balance sheet bigger than its peers, the bank has leveraged its dominance in Wall Street dealmaking and Main Street lending to capture gains from both economic engines.
"The company benefits from a portfolio of leading financial services businesses, providing both diversification and durable competitive advantages," said Macrae Sykes, portfolio manager of Gabelli Financial Services Opportunities ETF.
THE JAMIE PREMIUM
JPMorgan shares have long been viewed as carrying a "Jamie premium", which refers to the extra value investors attach to the bank because of its powerful CEO.
While its board has ramped up succession planning in recent years, the stock continues to benefit from Dimon’s influence.
Despite having underperformed the S&P 500 and the S&P 500 banks indexes this year, JPMorgan trades at 14.63 times expected earnings over the next 12 months, according to data compiled by LSEG. That compares with 13.58 for the S&P 500 banks gauge.
"There is no doubt that he has been instrumental in delivering strong shareholder returns. While the backdrop from the U.S. economy has been helpful, the bank operates in very competitive markets so execution has been key," Sykes said.
JPMorgan did not immediately respond to a request for comment.
ELEVATED EXPECTATIONS
A milestone such as $1 trillion in market capitalization is mostly a symbolic victory, but its raises expectations for future execution.
"If history is any guide, the trillion-dollar milestone does not guarantee a smooth path forward," said Fabien Yip, market analyst at IG, referring to Walmart’s slip below $1 trillion after it hit that milestone in February.
The bank may also face skepticism about the durability of its trading strength, which benefited in the latest quarter from market volatility sparked by the Middle East war.
"We view shares as fairly valued," said Morningstar equity analyst Austin Taggart.
While both investment banking and trading had been stronger than initially estimated, expecting the current levels of activity to last far into the future could be premature, he said.
