Investors can't stop piling more money into stock-market bets. Wall Street is making a killing on it.
JPMorgan Chase, Goldman Sachs and the other three biggest banks on Wall Street are on pace to have their best trading years ever, after a second-quarter boom in activity.
In the past, such gargantuan hauls for trading desks have been a sign of turmoil in the markets. For several banks, the previous record-trading year was 2009, when the market was going haywire.
This time around, stocks are near all-time highs, volumes are up and individuals can't get enough action, even as wars and artificial-intelligence exuberance keep investors on their toes. Massive hedge funds, from quant firms to multimanager giants, trade at rapid clips, as do individuals who have crowded into ever more high-octane fare such as short-dated options and turbocharged exchange-traded funds. Even the president has accounts making thousands of trades a quarter.
Together, JPMorgan, Goldman, Morgan Stanley, Bank of America and Citigroup are on track to log some $180 billion in trading revenue in 2026 if they continue at their current pace, according to a Wall Street Journal analysis.
"Clearly markets revenues in general have been quite elevated and strong for some time," JPMorgan CFO Jeremy Barnum told analysts. "The market is clearly extremely risk-on, and we're kind of takers of that."
Others on the street have benefited, too. Citadel Securities, a large market maker, brought in a record $4.3 billion in trading revenue in the first quarter. The company saw record average daily volumes of stocks traded by individual investors in May and June, with volumes more than double levels seen in 2024, according to Scott Rubner, head of equity and equity derivatives strategy at Citadel Securities.
And BlackRock, the world's biggest asset manager, gathered another $192 billion in assets during the last three months, bringing it to a record $15 trillion, as its clients pour funds into investing.
"I'm very optimistic on the outlook for global markets," CEO Larry Fink said.
For the big banks, trading was the standout even in a banner start to the year. Second-quarter revenue from markets was up about 42% for the group of the biggest banks from a year earlier; it increased 64% at Bank of America, 54% at Goldman Sachs and 35% at JPMorgan.
Banks' clients appeared especially interested in stock bets, where the group's revenue shot up 71% from a year ago. JPMorgan's equities markets revenue was up 86%, while Goldman's was up 72%.
"Everything is good and equity trading is off the charts," wrote Oppenheimer analyst Chris Kotowski.
The figures put Goldman Sachs and Citigroup on track to surpass their previous annual records for trading revenue for the first time since just after the financial crisis.
Shares of Goldman, Morgan Stanley and Bank of America each hit all-time highs this week, as did their benchmark index, the KBW Nasdaq Bank Index. And JPMorgan is close to becoming the first U.S. bank to surpass $1 trillion in market value.
The banks are benefiting from a marketwide surge as their trading desks facilitate buying and selling of stocks, bonds, commodities and foreign currencies on behalf of clients, earning a fee in the process.
U.S. average daily trading volumes of options and equities reached records of around 73 million contracts and 20 billion shares, respectively, during the second quarter, according to Jackson Gutenplan, market structure research analyst at Bloomberg Intelligence.
There have been plenty of reasons for investors to keep trading. The AI frenzy has helped the S&P 500 index notch 24 record closes this year. The initial public offering of SpaceX, the biggest IPO ever, saw explosive demand from investors, while volumes of options tied to SpaceX broke records within hours of their debut. Strong earnings growth and a resilient economy have kept everyday Americans in the stock market and off the sidelines.
Executives and analysts say that institutional clients are now constantly repositioning their portfolios reacting to major geopolitical events and dramatic market volatility, seeking to cash in on big gains and protect themselves from a potential drop. A fervor for AI stocks and related industries has also been a boon.
Goldman's CFO Denis Coleman pointed to elevated market dispersion, or the divergence between the performance of individual stocks. Single-stock volatility recently rose to levels not seen since the end stages of the dot-com bubble in the 1990s, spurred by violent swings in tech stocks such as Micron Technology and Advanced Micro Devices, according to analysts at Bank of America Global Research.
While moves in stock indexes have been relatively calm, trading has been more frenzied at the single-stock level, an environment that has led clients to seek help in managing their portfolios, Coleman said on the company's earnings call on Tuesday.
Brian Moynihan, Bank of America CEO, attributed the surge in stock-trading revenues to the AI boom, including an increase in activity in Asian markets. "A lot of it over the last 12 months has been the buildup of AI, especially outside the United States, and the activity of those markets picking up," he said Tuesday on CNBC.
Banks get vanishingly small margins on each trade, and they have been continuing to compress in recent years -- meaning desks now are pushing to increase volumes in order to boost revenue.
Banks have also been extending more loans to trading clients so that they can make bigger bets.
Goldman Sachs reported that equities financing revenue was up 91% in the second quarter from the prior year, outpacing its business facilitating trades for clients and setting a quarterly record. JPMorgan said it dedicated more of its balance sheet to financing equity trades.
Write to Ben Glickman at ben.glickman@wsj.com and Krystal Hur at krystal.hur@wsj.com
(END) Dow Jones Newswires
July 15, 2026 22:00 ET (02:00 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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