JPMorgan Chase Shares Plunge 4.66% as Cost Surge from AI, Inflation, Competition Drives Sector Slide

JPMorgan Chase shares plummeted 4.66% in pre-market trading on Dec. 10, 2025, marking one of the largest intraday declines in recent months as investor sentiment soured over the bank’s outlook for rising costs and a fragile consumer environment.

The selloff followed remarks by Marianne Lake, CEO of JPMorgan’s consumer and community banking division, who warned at a Goldman Sachs conference that the bank anticipates 2026 expenses climbing to $105 billion—9% higher than current analyst expectations and driven by inflation, strategic investments, and intensified competition in credit card services. Lake also highlighted structural cost pressures from AI development and physical infrastructure, while cautioning that consumer resilience may wane as pandemic-era savings dwindle.

Despite optimism around investment banking fee growth and markets revenue, the cost guidance overshadowed near-term earnings optimism. JPMorgan’s stock joined broader banking sector declines, with peers like Citigroup and Bank of America also underperforming as investors recalibrated expectations for margin compression and slower deposit growth amid an uncertain rate-cutting trajectory.

Analysts have been watching closely as the financial sector adjusts to a shifting macroeconomic landscape. As JPMorgan’s guidance for the coming year suggests a more cautious path forward, investors are reassessing both short-term volatility and long-term fundamentals. The broader implications of these developments could ripple across the entire financial ecosystem, particularly if similar cost pressures emerge at other large banks.

With the Federal Reserve still in the early stages of its rate-cutting cycle, the cost of capital and deposit dynamics remain uncertain, adding further complexity to JPMorgan’s strategic outlook. For now, the market appears to be pricing in a more conservative trajectory for the bank, even as its diverse business lines show varying degrees of resilience and potential for growth.