CEO Jamie Dimon called the trade "flawed, poorly reviewed, poorly executed" and said it reflected "sloppiness" and " bad judgment."
In a conference call Thursday, Dimon said the bank's Chief Investment Office suffered a trading loss of $2 billion in its synthetic credit portfolio, offset by a $1 billion securities gain, as a strategy to re-hedge its portfolio backfired.
Shares of JPMorgan fell 6.73% in premarket trading Friday to $38.Other bank stocks were also affected by the news. Citigroup (C) shares dropped 2.61% to $29.85; Morgan Stanley (MS) shares lost 2.82% to $15.16; shares of Goldman Sachs (GS) fell 2.32% to $103.85; Bank of America (BAC) dropped 2.47% to $47.51; shares of Wells Fargo (WFC) declined 1.9% to 432.56.
Arena Pharmaceuticals (ARNA) said Thursday Food and Drug Administration advisers recommended approval of the company's diet drug lorcaserin. Arena said it's working with the agency as it finishes its review. A final decision from the FDA could be made June 27. Lorcaserin could be the first new prescription diet drug in over a decade in the U.S. Shares of Arena Pharmaceuticals skyrocketed 96.72% to $7.20 in premarket trading Friday. 3 Hot Stocks for a Sideways Market
Nvidia (NVDA), the graphics chipmaker, is scheduled to post first-quarter results Friday. Analysts forecast profit of 10 cents a share in the April-ended period on revenue of $916.2 million. Shares of Nvidia ticked down 7 cents, or 0.56%, in premarket trading Friday to $12.35. LinkedIn Is a Glorified Rolodex
Other companies reporting earnings on Friday include Cache (CACH) and ReneSola (SOL). Cache reported a first-quarter loss of $1.2 million, or 9 cents a share, wider than the year-earlier loss of $772,000, or 6 cents a share. Analysts, on average, expected a loss of 9 cents a share. ReneSola reported first-quarter a loss of $40.2 million, or 23 cents a share, a reversal from year-earlier earnings of $43.3 million, or 24 cents a share. On average, analysts were expecting earnings of 31 cents a share. -- Written by Joseph Woelfel and Alexandra Zendrian
>To contact the writer of this article, click here: Joseph Woelfel >To submit a news tip, send an email to: firstname.lastname@example.org.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV