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Surging profits at JPMorgan and Goldman Sachs came from the trading desk, driven by a jolt of volatility in equities markets that handed both Wall Street banks the conditions to post stronger-than-expected results.
The quarter's haul is characterized as blockbuster at each firm. Trading as the headline driver Equities volatility was the engine.
When markets move sharply, trading volumes tend to follow, and both JPMorgan and Goldman were positioned to capture that flow. The result is a profit surge that cleared analyst forecasts at both institutions.
A trading haul is a windfall, not contracted revenue. It does not sit on the forward order book. When equities volatility subsides, the outsized revenue that came with it subsides too.
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