Analysts and data indicate that a significant increase in sales and trading, partly fueled by the massive SpaceX initial public offering, is set to drive earnings for major Wall Street banks in the second quarter. This performance is further supported by robust fee growth from advising on mergers and acquisitions.
Five of the six largest U.S. financial institutions — JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and Goldman Sachs — are scheduled to announce their results on July 14. Morgan Stanley will follow with its second-quarter report on July 15.
Trading remains a key area of strength in 2026, with volatility staying elevated above typical levels due to ongoing geopolitical tensions and uncertainties related to artificial intelligence's disruptive impact.
Angad Chhatwal, head of fixed income, currencies, and commodities at Coalition Greenwich, stated that market revenue for the world's largest banks is projected to increase by at least 15% compared to the previous year.
Jamie Vickers, head of equities at Coalition Greenwich, noted that equities are poised to be the main driver of growth across global markets. He added that the SpaceX IPO would have created substantial revenues for banking divisions and for specific cash-equities desks during the quarter.
According to Morningstar analyst Sean Dunlop, Wall Street leaders like Goldman Sachs and Morgan Stanley, which played major roles in the nearly $86 billion SpaceX IPO, are likely to show strong performance in equities. Reports indicate that banks involved in the SpaceX IPO earned approximately $500 million in fees.
However, Dunlop warned that while still robust, second-quarter trading revenue might decelerate compared to the first quarter, which saw unusually high activity driven by volatility from initial geopolitical shocks and subsequent inflation and interest rate adjustments.
Investment banking has also been a significant contributor to revenue growth for banks, with massive equity offerings and multi-billion-dollar deals pointing to the most optimistic deal-making climate in years.
Data shows global investment banking revenue reached $61.4 billion in the first half of 2026, a 24% increase from the same period a year earlier. JPMorgan maintained its position as the global leader in investment banking revenue, while Goldman Sachs led in M&A advisory.
Other major deals in the second quarter included chip designer Cerebras' $6.4 billion IPO and a substantial $85 billion share sale by Alphabet , the parent company of Google.
Robust Expansion in Lending
Banks are also anticipated to gain from loan growth and an expanding net interest margin, which measures the difference between what a bank earns on loans and pays on deposits.
Analysts noted that data from the U.S. Federal Reserve indicates loan growth accelerated in the second quarter, supported by strong momentum in commercial and industrial lending.
Jefferies analyst David Chiaverini commented that despite lingering uncertainty from geopolitical factors and market volatility, many banks report that clients are increasingly accepting the current conditions as a 'new normal' and proceeding with their investment plans.
Investors will focus on the loan growth outlook for the latter half of 2026 and executives' views on the U.S. economy, as worries persist about inflation affecting consumer spending power.
Morningstar analyst Austin Taggart advised that investors should also closely monitor credit metrics and overall loan demand, as these will be crucial factors supporting a continued rally in bank stocks into the second half of 2026.
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