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Hello everyone, welcome back to the channel. Today, as you can see, I 'm not in the studio. I mentioned I was going on vacation; I'm traveling, as you can see, I'm at the beach. But I had to put together the video about the bank earnings reports, which I think were quite informative about the economy.
Let's go to my computer and get started. We can see that the market opened mixed at 11:30 AM. The 81 is in the green, the C-10 is down 0.10, the DP 550 is down 0.5, and the Nasda is down 1.11. But let's get right to the news. Oil prices rose more than 4% after the United States tightened sanctions on crude sales.
Brandt crude futures, the international benchmark, for December delivery traded 4% higher at $89.4 per barrel, while US West Texas Intermediate crude futures for November rose 4.1% to $ 86.3 per barrel. The return to $0 per barrel came after the United States imposed sanctions on Thursday on two shipping companies that it said violated the G7 oil price cap.
In fact, oil prices fell in the hours following the announcement. Of course, oil prices are sensitive to many factors, including the ongoing conflict in the Middle East. As I mentioned in other videos, oil isn't currently affected by what's happening with Israel and Palestine because neither of them are major oil producers.
But if Iran gets involved in the war, then we'll see a bit more trouble, as happened with Russia and Ukraine. Thanks to... We know that Russia is a major oil producer, and that's why we were so affected last year, and why we saw so much inflation last year because oil prices rose considerably. We also know everything that's happening with the economy, but let's get started with the different companies.
First, I want to talk about Microsoft before the banks' earnings reports, since Microsoft finally closed the acquisition of Activation Blizzard for $69 billion after a long regulatory review. Remember that they announced this purchase in January of last year—almost two years ago—and they hadn't been able to finalize it due to European authorities.
It's Microsoft's largest deal in its 48-year history, and it comes after the company calmed competition concerns from UK and European regulators and obtained a favorable ruling from a US district judge. The deal gives Microsoft a significant portfolio of video game franchises. We know that many companies are entering the video game world today to achieve better growth, since the video game industry has always experienced very strong growth.
Even more so now with social media, and Microsoft wanted to enter that world. The game developer generated $7.5 billion in revenue in its last fiscal year, a small fraction of the $212 billion in sales obtained by Microsoft, which is quite good. Microsoft signed agreements with its console rivals Nintendo and Sony, promising them access to Call of Duty games for 10 years, and Microsoft made similar agreements with cloud gaming providers, including Boosteroid and Nvidia Anyware Ubitu.
I want to know what you think about this acquisition of Activation Blazer by Microsoft. We know that Microsoft had wanted to do it for a long time, wanting to invest in this for a long time to see good growth. Now let's go to the banks. We see that JP Morgan Chase is currently at $150. It rose again by 3.30 after the earnings report.
JP Morgan Chase shares rose after earnings exceeded expectations due to higher interest rates. Benign credit was 4.33% and revenue was 4.69 billion. Compared to estimates of $39.3 billion, quite good for the largest bank in the United States, the bank said that profits increased a very good 35% to $ 13.15 billion.
Revenue increased 21% to $ 4.69 billion, meaning that profits are seeing much faster growth than revenue, which is something I love to see in companies. Revenue increased to $4.69 billion, as I mentioned, helped by stronger-than-expected net interest income. That measure increased 30% to $22.9 billion, exceeding analysts' expectations by approximately $600 million.
At the same time, loan provisioning of $1.38 billion was much lower than the estimate of $2.39 billion. Chief Executive Jamie Diamond, whom we love to talk about a lot on this channel because of all the expectations and speculation he announces about the market and the economy, now acknowledged that the largest bank The US economy was earning excessive net interest income and below-normal borrowing costs, which will normalize over time.
Jamie Diamond warned that while US consumers and businesses were healthy, households were spending their cash balances, and the tight labor market and extremely high levels of government debt meant that interest rates could rise even further. Remember that at the last Fed meeting, they didn't raise interest rates, but they did warn that they could rise at least once more before the end of the year.
With yesterday's inflation report, it's very likely that interest rates will rise once more, since we see that inflation is a bit higher than expected, whether due to oil or something else. It's higher than expected, more than Jerome Paul and the Fed anticipated. Therefore, they have to take action again.
The retail banking division of JP Morgan Chase experienced a 36% increase in profit to $5.9 billion, driven by higher net income. Interests and the acquisition of First Republic: Now, JP Morgan Chase CEO Jamie Diamond warns that this is the most dangerous time for the world in decades. This may be the most dangerous moment beyond military conflicts.
Diamond cited the rising national debt and the largest fiscal deficits ever recorded in peacetime, which he said increased the risks of inflation and interest rates remaining high. Jamie Diamond recently said he has been warning his clients about the possibility that interest rates will not only remain high but also rise significantly from now on, especially with the economic reports we have been seeing recently.
While we hope for the best, we prepare the firm for a wide range of outcomes so that we can consistently deliver for clients regardless of the return. They essentially hope for the best but prepare for the worst, so that if the worst happens, they don't fall short of expectations and the company is n't negatively impacted.
The next bank to report earnings this morning was Citigroup. Citigroup shares rose thanks to better-than-expected third- quarter revenue. Earnings per share were 1.63, which is not comparable to expectations, but excluding divestitures, earnings per share were 1.52. Revenue was $20.14 billion versus the expected $9.31 billion, quite good.
City Group's institutional clients unit reported $10.6 million in revenue, up 12% year-over-year. Growth isn't as high as Chase's, but still quite good and 2% higher than the second quarter. The personal banking and wealth management division generated $6.8 billion in revenue, approximately 10% higher year-over-year and 6% higher than the second quarter.
According to them, despite headwinds, our five main interconnected businesses each posted revenue growth, resulting in overall growth of 9%. Quite a good report from City Group, as well as Morgan Chase for the time being, but even better was WS Fargo. Worlds Fargo shares rose after third-quarter results beat Wall Street expectations.
WS Fargo reported Earnings of 48 cents per share in the quarter, or 1.39 cents excluding discrete tax benefits, were unclear. The exact number was comparable to Wall Street expectations, but both figures are higher than the consensus EPS of 1.24 cents per share. Earnings are also significantly higher than the 86 cents per share earned in the same quarter a year ago.
Total revenues amounted to 20.9 billion cents during the quarter, exceeding the consensus expectation of 0.1 billion cents. Revenues were 6.5 percent higher than the same quarter last year. Again, not like the growth of JP Morgan Chase or Citigroup. But good growth and much more. We know the problems WF has.
Our revenue growth compared to a year ago included both higher net interest income and non-financial income, as we did not benefit from higher rates and the investments we are making in our businesses. While the economy has remained resilient, we are seeing the impact of the economic slowdown with loan balances decreasing and write-offs continuing to deteriorate moderately, which is what we have been talking about.
For a long time now, banks have undoubtedly benefited from high interest rates. But those who don't benefit, but rather are affected, are all of us. Thanks to the fact that inflation is also quite high, it costs us much more to borrow money, just like it does for companies. Now, that was all the reports this morning from JP Morgan Chase City Group and World Lighthouse.
For next week, we have more companies reporting earnings. On Tuesday, we have Bank of America along with Colman Sax. On Wednesday, we have none other than Tesla and Netflix, which we will be watching very closely since they are two companies that tend to both make and break the market depending on how they perform.
On Thursday, we have IT&T. And finally, on Friday, several other very interesting companies like American Express. Now, let me know in the comments below what you think about all these earnings reports and news. Again, please excuse me for being at the beach and not in my studio, but at least I was able to record the banks' earnings reports.
Here's a video about the five companies I have on my watchlist, and here's a button to take care of yourself. Thank you very much. and until next time
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