(Reuters) -JPMorgan Chase topped first-quarter profit estimates on Friday, driven by record equities trading and higher fees from debt underwriting and merger advisory.

Shares of the biggest U.S. bank climbed about 3% before the open even as CEO Jamie Dimon remained circumspect on the economy as corporate America navigated the fallout of President Donald Trump's tariffs.

"Clients have become more cautious amid an increase in market volatility driven by geopolitical and trade-related tensions," Dimon said. "The economy is facing considerable turbulence, including geopolitics."

The bank increased its provisions for credit losses to $3.3 billion from $1.9 billion last year. Consumers and businesses could struggle to repay their loans if the new import levies reignite inflation and dampen economic growth.

The results from the biggest U.S. bank offer a glimpse into the economic implications of Trump's trade agenda. Bank stocks tanked after the tariffs were announced last week.

Uncertainty surrounding the trade policy has fueled market turbulence. Trump last week unveiled steep reciprocal tariffs on dozens of countries, only to pause many of them on Wednesday.

The heightened volatility due to shifting expectations lifted banks' trading business in the first quarter as investors quickly adjusted their portfolios.

JPMorgan's trading revenue climbed 21% to $9.7 billion, higher than the earlier expectations of a low double-digits percentage gain. Equities trading surged 48% to a record $3.8 billion.

Investment banking fees climbed 12%, largely buoyed by optimism in the first three months of 2025 that Trump would enact pro-growth policies, ease regulations and lower taxes.

CREDIT RISK

"You'll see more credit problems," Dimon told Fox Business' "Mornings with Maria" program on Wednesday.

On Monday, Dimon warned shareholders that trade wars could have lasting negative consequences including persistent inflation and high fiscal deficits.

Earnings were $14.6 billion, or $5.07 a share, for the three months ended March 31, JPMorgan said. That compares with $13.4 billion, or $4.44 a share, a year earlier.

Excluding one-time costs, the bank earned $4.91 per share, higher than estimates of $4.61, according to data compiled by LSEG.

Net interest income (NII) - the difference between what the bank earns on loans and pays out on deposits - rose 1% to $23.4 billion.

The bank expects NII $94.5 billion for the full year, higher than the $94 billion it expected earlier. The guidance for NII, excluding markets, remained unchanged at $90 billion.

Shares have dropped around 8% since Trump unveiled his tariffs, and hit a seven month-low earlier this week.

(Reporting by Niket Nishant in Bengaluru and Nupur Anand in New York, editing by Lananh Nguyen and Sriraj Kalluvila)