HispanicBusiness

Growing fears over the U.S. economy unnerved investors yesterday, despite bumper profits from banking giants JP Morgan Chase and Wells Fargo.

As part of a double dose of grim data, the International Monetary Fund slashed its growth forecast for the year from 2pc to 1.7pc.

It came as official figures confirmed a 0.4pc slump in US retail sales in March, marking the biggest monthly fall for nine months.

This helped send the Dow Jones down 32 points to 14,832 in early trading. The decline in US retail sales follows a 1pc rise in February and a 0.1pc drop in January, and has been seen as evidence that this year's tax hikes have made Americans more cautious about spending.

Chris Williamson, chief economist at Markit, said: "The concern is that growth could slow again in the second quarter."

The gloomy figures appeared to undermine claims from JP Morgan chief executive Jamie Dimon that the recovery in the US economy is "getting stronger."

His comments came as the bank announced record profits for the first three months of the year of pounds sterling 4.2bn, up a third on the same period last year. The bank smashed expectations as it continued to shrug off last year's "London Whale" trading losses of pounds sterling 3.9bn. But the record figures belied a mixed picture of the US economy.

While a drop in bad loans were seized on by Dimon as a sign "the economy is healthy and getting stronger," profits at the consumer banking division fell 12pc.

Rival Wells Fargo also posted a better than expected 23pc rise in profits to pounds sterling 3.4bn. But it confirmed a decline in home loans for the second quarter running.