Finance

Jamie Dimon expects S&P 500 earnings estimates to fall amid uncertainty

Published

2 months ago

April 11, 2025

JPMorgan Chase CEO and Chairman Jamie Dimon gestures as he speaks during the U.S. Senate Banking, Housing and Urban Affairs Committee oversight hearing on Wall Street firms, on Capitol Hill in Washington, D.C.

Evelyn Hockstein | Reuters

JPMorgan Chase CEO Jamie Dimon said Friday that he expects estimates for corporate earnings to fall amid the uncertainty created by President Donald Trump‘s trade negotiations.

In a call with reporters to discuss first quarter earnings, JPMorgan CFO Jeremy Barnum said he didn’t see a reason to pull the bank’s guidance, which is contingent on how the economy and interest rates play out.

His boss, Dimon, then interjected, speaking about the broader corporate world: “I would just add companies, some have taken away their guidance. I expect to see more of that.”

“Analysts have generally reduced their S&P estimate earnings by 5%,” in recent days, Dimon said. “I think you’ll see that come down some more.”

Companies will be reporting earnings over the next several weeks, giving managers an opportunity to update investors on their outlook during a period of heightened uncertainty. Markets have whipsawed since Trump announced a sweeping set of tariffs on America’s trading partners last week, and have remained volatile as U.S.-China tensions have escalated.

Already, companies with exposure to the American consumer including Walmart, Delta and Frontier Airlines have reined in parts of their guidance to investors.

The uncertainty is causing clients to pull back from acquiring companies and making investments as they adopt a wait-and-see attitude, Dimon and Barnum said.

Anecdotal examples suggest that “people are being cautious,” Dimon said. “You know, people are pulling back on doing deals, not just big ones, but middle market companies are being very cautious about investment.”

Barnum added that the environment has led businesses to drop long term plans in favor of “near term optimization of supply chains.”

“This level of policy uncertainty is one that makes it hard to plan for the long term,” Barnum said.

Meanwhile, consumers have held up in the first quarter, and more recently there are signs they have been accelerating purchases on concerns that tariffs will make them more expensive, Barnum said.

This story is developing. Please check back for updates.

Finance

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Published

20 hours ago

June 6, 2025

Business Finance News

Finance

Swiss government proposes tough new capital rules in major blow to UBS

Published

22 hours ago

June 6, 2025

Business Finance News

A sign in German that reads “part of the UBS group” in Basel on May 5, 2025.

Fabrice Coffrini | AFP | Getty Images

The Swiss government on Friday proposed strict new capital rules that would require banking giant UBS to hold an additional $26 billion in core capital, following its 2023 takeover of stricken rival Credit Suisse.

The measures would also mean that UBS will need to fully capitalize its foreign units and carry out fewer share buybacks.

“The rise in the going-concern requirement needs to be met with up to USD 26 billion of CET1 capital, to allow the AT1 bond holdings to be reduced by around USD 8 billion,” the government said in a Friday statement, referring to UBS’ holding of Additional Tier 1 (AT1) bonds.

The Swiss National Bank said it supported the measures from the government as they will “significantly strengthen” UBS’ resilience.

“As well as reducing the likelihood of a large systemically important bank such as UBS getting into financial distress, this measure also increases a bank’s room for manoeuvre to stabilise itself in a crisis through its own efforts. This makes it less likely that UBS has to be bailed out by the government in the event of a crisis,” SNB said in a Friday statement.

‘Too big to fail’

UBS has been battling the specter of tighter capital rules since acquiring the country’s second-largest bank at a cut-price following years of strategic errors, mismanagement and scandals at Credit Suisse.

The shock demise of the banking giant also brought Swiss financial regulator FINMA under fire for its perceived scarce supervision of the bank and the ultimate timing of its intervention.

Swiss regulators argue that UBS must have stronger capital requirements to safeguard the national economy and financial system, given the bank’s balance topped $1.7 trillion in 2023, roughly double the projected Swiss economic output of last year. UBS insists it is not “too big to fail” and that the additional capital requirements — set to drain its cash liquidity — will impact the bank’s competitiveness.

At the heart of the standoff are pressing concerns over UBS’ ability to buffer any prospective losses at its foreign units, where it has, until now, had the duty to back 60% of capital with capital at the parent bank.

Higher capital requirements can whittle down a bank’s balance sheet and credit supply by bolstering a lender’s funding costs and choking off their willingness to lend — as well as waning their appetite for risk. For shareholders, of note will be the potential impact on discretionary funds available for distribution, including dividends, share buybacks and bonus payments.

“While winding down Credit Suisse’s legacy businesses should free up capital and reduce costs for UBS, much of these gains could be absorbed by stricter regulatory demands,” Johann Scholtz, senior equity analyst at Morningstar, said in a note preceding the FINMA announcement.

“Such measures may place UBS’s capital requirements well above those faced by rivals in the United States, putting pressure on returns and reducing prospects for narrowing its long-term valuation gap. Even its long-standing premium rating relative to the European banking sector has recently evaporated.”