Good morning. Here’s what happened overnight and what you need to know today.
1.
Tectonic shift: Five of the largest banks in the US posted a combined profit of more than USD49 billion ($70.3 billion) in the second quarter, a 39% jump from a year earlier and above analyst estimates, as a boom in trading and dealmaking drove record results. JPMorgan Chase booked its highest quarterly profit ever at USD21.2 billion, also the largest ever posted by a US bank. Its equities trading revenue surged 86% to USD6.03 billion. Goldman Sachs posted a record USD7.42 billion from equities trading, up 72%. Bank of America and Wells Fargo also beat estimates on trading and dealmaking strength, while Citigroup shares fell after executives flagged deeper job cuts and higher second-half costs. Banks were boosted by SpaceX’s initial public offering last month, which generated about USD500 million in fees across Wall Street. “It’s getting close to as good as it gets,” JPMorgan chief executive Jamie Dimon said. “We just don’t know how long it’s going to last.” Dimon warned of risks “shifting below the surface like tectonic plates”, citing geopolitical tensions, sticky inflation and elevated asset prices. CFO Jeremy Barnum said staff were being told to pick cheaper AI models for simple tasks rather than the latest pricier ones. He described the bank’s token spend as “trivial” in the first half. (GS)(JPM)(BofA)(Citi)(WSJ)(Bloomberg)(Reuters)(NYT)(FT)(Capital Brief)
2.
Central command: Anthony Albanese will seize control of Australia’s AI agenda, creating an Office of AI inside the Department of Prime Minister and Cabinet to coordinate national standards for the technology, according to speech excerpts released by his office. In an address at the University of Sydney today, the prime minister will compare AI to earlier technological shifts, saying that just as government developed coordinated approaches to civil aviation in the 1920s and genetics in the 1990s, it must do the same for AI. “Australia will be the first country in the world to bring these issues into a single, national framework,” he will say. “And getting this right will enhance our appeal to international investors, by delivering greater clarity and speed for approvals, and a streamlined process for verifying compliance.” The office will work with Industry and Innovation Minister Tim Ayres and Assistant Science Minister Andrew Charlton. The move marks a shift from the government’s earlier, more hands-off approach to the technology. Albanese is not expected to resolve copyright reforms that AI companies including Anthropic are seeking. (Capital Brief)(AFR)(SMH)
