JPMorgan Chase & Co. (NYSE:JPM) last week reported earnings results that were far above estimates. It looked like a blowout, but the stock was slammed and continues to trend lower.
Sometimes higher interest rates are good for financial stocks. Financial institutions can lend at higher rates and this makes them more profitable.
But there could also be a problem. Rising rates are good until they’re not and that may be the case now. The issue is the higher costs that are associated with inflation.
JPMorgan has to pay its employees more now. This could more than offset the increased profits from higher rates and that could hurt its bottom line. This caused investors to sell and to do so aggressively.
But shares may be close to a bottom. The last two times they dropped to $152.50 they rebounded.
To learn more about reading charts check out the new Benzinga Trading School.
