Bank of America

Bank of America

JPM Revenue Rebounds On Stronger Fixed Income Trading, Jump In Lending

JPMorgan Chase & Co., the biggest U.S. bank by assets, said second-quarter profit fell 1.4 percent, beating analysts’ estimates as fixed-income trading revenue and loan growth jumped. Revenue climbed 2.8 percent to $25.2 billion, beating the $24.5 billion average estimate of seven analysts surveyed by Bloomberg. The company said average core loans increased 16 percent from a year earlier.

Why Active Managers Are Having The Worst Year On Record

It has already been an abysmal year (and decade) for hedge funds in particular, and active asset managers in general. But how abysmal? According to Bank of America, "just 18% of large cap funds outperformed the Russell 1000 in 1H16, so far making it the worst year for active funds in history (since ’03)."

US Consumers No Longer "Eating Out" - Restaurant Guest Counts Tumble To Three Year Lows

Knapp-Track casual dining same store sales for the month of June were down 2.3% with guest counts down 4.8%. These results compare against same store sales that were up 1.5% and guest counts that were down 1.1% in June 2015.  Sales and guest counts in June were the weakest since January 2014 (more than two years) and February 2013 (more than three years), respectively. On a two-year basis, same store sales were down 0.8% with guest counts down 5.9%.

Charting The Epic Collapse Of The World's Most Systemically Dangerous Bank

It’s been almost 10 years in the making, but the fate of one of Europe’s most important financial institutions appears to be sealed. But, if the deaths of Lehman Brothers and Bear Stearns were quick and painless, the coming demise of Deutsche Bank has been long, drawn out, and painful.

Bank of America Throws In The Towel: "The Profits Recovery Won't Live Up To Expectations"

"In the wake of the weaker-than-our-expected 1Q results and recent macro headwinds, we are trimming our S&P 500 EPS forecasts by 3% in 2016 and 2% in 2017. Given the S&P 500’s 15% rally since mid- February, we are concerned that much of the improvement in earnings growth may already be priced in, especially with signs that earnings revision trends may be rolling over."

The Reason For The Relentless Scramble For US Corporate Debt In One Chart

While the $5.9tr US IG corporate bond market represents only 12% of that global market, it is now responsible for 33.0% of its total (effective) yield payment. In other words, nearly one in three (global) dollars paid out in the global IG broad market is paid to investors in the US IG corporate bond market.

Spot The "Outlier" Who Bought Stocks In Q2

The slow motion LBO of the market by the market continues, as more debt is issued fund stock buybacks and push stocks briefly, and artificially, higher, even as corporations lever themselves up to all time highs now that the even the merest risk of rising rates has been buried for years to come.

"China Is Headed For A 1929-Style Depression"

“The government is allowing speculation by providing cheap financing,” Andy Xie exclaimed, China “is riding a tiger and is terrified of a crash. So it keeps pumping cash into the economy. It is difficult to see how China can avoid a crisis.”

This Is "Worrisome": The Probability Of A US Recession Surges To 60%, Deutsche Calculates

"This relentless flattening of the curve is worrisome. Given the historical tendency of a very flat or inverted yield curve to precede a US recession, the odds of the next economic downturn are rising. In our probit model, the probability of a recession within the next 12 months has jumped to 60 percent, the highest it’s been since August 2008."

"This Is The Capitulation Phase" - Why Treasury Yields Are About To Really Plunge

For the rates market, the significance of this acceptance phase by pensions cannot be understated, in our opinion. A $3 trillion industry running a $500 billion funding gap and a significant duration gap waking up to reality is likely to have major implications for the market. In the extreme case, entire pensions could be offloaded from corporate balance sheets to insurance companies (increasingly like the UK, Exhibit 1)–generating significant demand for long-end duration during such transactions.

Hedge Funds No Longer Have Any Idea How To Trade This Market

While we sarcastically pointed out back in 2013 that with the Fed (and now every other central bank) as the market's Chief Risk Officer, there is no longer a need for anyone to do fundamental analysis, this has not only come true but the outcome is now is far worse. Because it confirms what we have said all along: not only is there no market left aside from what Central Banks decide will happen to "risk assets" on any given day, but the smart money- both hedge and mutual funds - have now completely lost the plot.

Day 3 Of Global Post-Brexit Rally: European Stocks, US Futures At Session Highs

Day three of the post-Brexit rally continues, and after some initial weakness due to concerns about Chinese currency devaluation, both European stock and US equity futures were trading at session highs, facilitated by yesterday's stress test results which saw dozens of US banks unleash a tsunami of stock buyback announcement which in turn pushed S&P futures to new post-Brexit highs.