Stock market today: Dow, S&P 500, Nasdaq slip as chip stocks fall, earnings season kicks off

Three of America’s biggest banks reported third quarter results on Wednesday, signaling fresh evidence that the US economy is holding up despite higher interest rates.

US consumer and business clients remained relatively resilient in the face of higher borrowing costs, with results from JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C) showing spending and lending continued to grow from a year ago while loan losses have remained largely contained.

JPMorgan’s average credit card loans rose 7% from a year earlier, with card charge-offs falling from 2.91% from 3.15%. Consumer loan balances at Wells Fargo rose 4%, with the credit card charge-off rate falling to 3.73% from 4.02%.

Citigroup reported US card spending rose 11% over the same period, while charge-offs improved to a rate of 3.6%, down from 4.0% a year earlier.

“Our data shows that our consumer and business customers are doing well,” Wells Fargo CEO Charlie Scharf said Tuesday. “Consumers are spending more, loan delinquencies are low, and deposit and investment balances have grown.”

Scharf said AI infrastructure investment, high employment and wage growth continue to outweigh the risks from higher rates, oil prices and inflation.

JPMorgan CEO Jamie Dimon struck a more cautious tone, warning on a call with reporters that another percentage point rise in interest rates could be particularly painful as borrowers refinance debts at higher costs and credit spreads widen.

And despite relatively healthy credit conditions, both Citi and Wells Fargo increased their total provisions for potential loan losses.