January 15, 2022
Keep up with global market cues, deal-making and economic indicators.
Good morning! Wells Fargo easily beat Wall Street expectations for Q4 with interest rates beginning to take off, likely another boost for the nation’s largest mortgage lender going forward and more...
Omicron leaves Germany on brink of recession
Illustration: Yajur Negi

One-liner: The risk of recession is looming for Germany after Europe’s biggest economy shrank at the end of 2021 and as it faces a bumpy start to this year, with the rapid spread of Covid’s omicron variant deterring people from shopping and travel and supply bottlenecks holding back manufacturers.

Output falls: Output in Germany fell by between 0.5% and 1% in Q4, the state statistics agency Destatis said Friday.

Shaky forecast: Forecasts are also shaky for the first three months of 2022, and two straight quarters of falling output would leave Germany in recession, according to one commonly used definition.

Germany sets the pace: Germany helps set the pace for the entire eurozone, the 19 European Union countries that use the euro currency and one of the world’s largest economies.

Factories in other countries: Many German companies have suppliers or factories in other European countries, so Germany’s business activity can boost growth for its neighbors.

China’s trade surplus surges to $676.4bn in 2021
Source: Inhouse illustration

One-liner: China’s politically volatile global trade surplus surged to $676.4bn in 2021, likely the highest ever for any country, as exports jumped 29.9% over a year earlier despite semiconductor shortages that disrupted manufacturing.

Dec exports swell: The country’s monthly trade surplus in Dec swelled 20.8% over a year earlier to a record $94.4bn, customs data showed Friday.

Monthly export surplus: China piled up a series of monthly export surpluses in 2021 but they prompted less criticism from the US and other trading partners than in earlier years while their govts focused on containing coronavirus infections.

Exports at $3.3tr in 2021: Exports rose to $3.3tr in 2021 despite shortages of processor chips for smartphones and other goods as global demand rebounded from the coronavirus pandemic.

  • Manufacturers also were hampered by power rationing in some areas to meet government efficiency targets
Wells Fargo’s $5.8bn profit tops expectations
Source: Pixabay

One-liner: Wells Fargo easily beat Wall Street expectations for Q4 with interest rates beginning to take off, likely another boost for the nation’s largest mortgage lender going forward.

$1.38  EPS: The San Francisco bank earned $5.8bn, or $1.38 per share, handily surpassing the $1.11 industry analysts were expecting, according to a survey by the data firm FactSet.

$20.86bn sales: Wells took in $20.86bn in sales in the quarter, also topping Wall Street projections of $18.8bn.

Revenue: The bank had revenue of $18.49bn in the same quarter last year.

Net interest income: Wells reported $9.26bn net interest income in the period, down slightly from last year, but expected to bounce back this year with rates on long-term loans seem destined to rise quickly.

JPMorgan Q4 earnings fall 14%, but 2021 profit sets record
Source: Inhouse illustration

One-liner: PMorgan Chase says Q4 profits fell 14% from a year earlier, due to a weaker performance from its trading desk and higher compensation expenses for employees.

Annual profit rises: Even with the weaker quarter, JPMorgan had a record annual profit, nearly $50bn. The total is significantly more than what the bank brought in during 2019, before the pandemic.

Net-zero interest rates: The bank, like others in the financial industry, also continues to deal with the impact of near-zero interest rates. Low rates have kept JPMorgan’s revenue mostly flat for the past year.

$3.33 EPS: The New York-based financial giant on Friday reported a profit of $10.4bn, or $3.33 per share for the last three months of 2021.

Last year’s profit: That’s down from a profit of $12.14bn, or $3.79 a share, in the same period a year ago. While JPMorgan’s profits fell, the results were still better than what analysts had forecast, with the average per-share profit on FactSet being $3.01.