Sign Up on MEXCJPMorgan Profit Shrinks By 17%; Will It Affect Crypto?
The correlation between the traditional and digital asset markets is at its peak. Any minor statement or data released by the authorities is enough to surge or plunge the markets. However, JPMorgan, an investment banking company, has reported a major drop in its net profit.
JPMorgan lowers fund for reserves
As per reports, JPMorgan’s Net profit for the third quarter has dipped by a whopping 17%.to stand at $9.74 billion. It mentioned that they are setting $808 million aside for the reserves. This can be termed as a major drop in profit as the firm was able to set aside $2.1 billion in reserves in the third quarter of 2021.
Experts suggest that there is a surge in the interest income that got hit by the high loan loss provisions. However, the shares of JPMorgan’s share price jumped by around 4% after the report came out. Investors are keenly looking after the US authority’s aggressive interest rate in order to cool down inflation.
It added that JPMorgan’s Revenue from investment banking has also dropped dramatically, It has plunged by over 43% to stand at $1.7 billion. It has been reported due to the mix of jumping inflation and fear of upcoming recession.
Can it hurt the crypto market?
However, rising rates are termed as positive for the banks as it allows them to charge higher interest from the borrowers Earlier, JPMorgan reportedly said that cryptocurrencies lack value.
The increasing correlation between the crypto market and the traditional market is an alarming bell for investors. Stock indexes like Nasdaq and S&P 500 saw a drop just after the announcement of the September US CPI data. The crypto market mirrored the major markets by registering a drop of around 3%.
However, the Friday morning crypto market saw a broad recovery following the traditional markets. The global crypto market cap surged by more than 3% to stand at $930 billion.
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