1) Does JPMorgan’s miss signal a broader capital markets slowdown?

It can, but it is more “uneven recovery” than a full downturn.

Investment banking is highly cyclical: If JPM’s IB revenue came in below guidance, it often reflects slower deal-making (M&A) and more cautious underwriting (IPOs, bonds) across the street, not just a firm-specific issue.

High rates delay decisions: Higher discount rates make valuations harder to agree on, so CEOs and PE funds tend to wait longer, pushing deal timelines out.

Trading can mask weakness: Even when IB is soft, markets revenue (FICC/equities trading) can hold up. So the signal is: deal activity is not rebounding as fast as hoped, not that the entire capital markets engine has stalled.

Bottom line: JPM’s miss likely supports the view that capital markets are recovering slowly and selectively, rather than broad-based “green shoots”.

2) In higher-for-longer, can banks defend margins against rising costs?

Yes, but only the best-run banks can. The playbook is straightforward, but execution matters.

How banks defend margins:

Deposit discipline: Avoid overpaying for deposits (lower “deposit beta”) to protect net interest margin (NIM).

Repricing assets: Keep loan yields firm, reprice floating-rate books, and manage securities portfolios smartly.

Cost control: Reduce headcount growth, cut discretionary spend, and push automation to offset wage inflation.

Mix shift to fee income: Wealth management, cards, treasury services, and asset management fees help cushion NIM pressure.

Credit remains key: If credit costs rise sharply (defaults, delinquencies), margins can be “defended” but earnings still get hit.

What makes it hard:

Operating costs are sticky (comp, tech spend, compliance).

Competition for deposits is real, especially when customers can earn more in money market funds.

Bottom line: Banks can defend margins in higher-for-longer, but the winners will be those with strong deposit franchises, diversified fee engines, and tight expense control.