JP Morgan’s Billions in Trading Losses Cause a Ripple EffectPosted by in Blog on May 15, 2012
A variety of bank stocks declined in value Friday after J.P. Morgan Chase broke the news that it suffered at least $2 billion in trading losses. Financial Advisor magazine reports that Chase dropped 6.7 percent in value, while Bank of America, Morgan Stanley, and Citigroup all suffered collateral damage of sorts, sinking at least 2.7 percent in value.
In addition, the Standard & Poor 500 went down 0.8 percent, and the Dow Jones Industrial Average sank 0.7 percent Friday. BofA went down 2.7 percent in value Friday, Morgan Stanley 2.8 and Citigroup 3.8 percent.
The news about JP Morgan Chase has struck a nerve in and out of Wall Street“ JPMorgan has held to a higher standard among the banks,” Walter Todd, CIO of Greenwood Capital, tells the magazine. “If this happens to them, it raises the question, if they have these issues, who else does?” And Ben Bernanke, chairman of the Federal Reserve, said in a speech Friday that “Banks still have more to do to restore their health and adapt to the post-crisis regulatory and economic environment.”
In other news regarding JP Morgan Chase, so far three people have lost their jobs, the Wall Street Journal reports. In addition, the trading losses could end up being as high as $4 million.
Written by Lisa Swan