Trading revenue is nearly $39 billion! The five major Wall Street banks released eye-catching second-quarter financial reports, and the role of AI is evident

Trading revenue is nearly $39 billion! The five major Wall Street banks released eye-catching second-quarter financial reports, and the role of AI is evident.

The second-quarter earnings season for U.S. stocks officially kicked off on July 14, local time. The top five Wall Street banks - JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs and Wells Fargo - all beat earnings expectations.

According to analysts' statistics, the total trading revenue of these five banks in the second quarter is expected to be close to US$39 billion, with the stock trading business performing particularly well, and related revenue of many institutions hitting record highs. Morgan Stanley will announce its financial results on the 15th.

Strong performance growth is driven by multiple factors. On the one hand, geopolitical tensions, changes in Federal Reserve policy expectations, and artificial intelligence (AI)-related fluctuations have caused the market to continue to fluctuate, and customer trading activity has increased significantly, pushing up trading revenue.

On the other hand, capital market activities have picked up, and large-scale IPOs and M&A transactions have been concentrated, providing strong support for the investment banking business. Among them, large-scale transactions such as SpaceX’s largest IPO in history have allowed major underwriters such as Goldman Sachs and Morgan Stanley to gain a lot.

Chief Executive Officers (CEOs) of various industries believe that consumer spending power is elastic and discussed their views on AI. Specifically, Citigroup's profits jumped 45%, with revenue hitting a ten-year high; JPMorgan Chase's net profit surged 41% year-on-year to US$21.2 billion, a record high in the U.S.

banking industry, and market revenue surged 35% to a record high of US$12.1 billion; Goldman Sachs' net profit almost doubled, and stock trading revenue soared 72% to a record high of US$7.42 billion; Bank of America's net profit increased 27%, and stock trading revenue also increased by a record 70%. U.S.

economy and consumers are resilient JPMorgan Chase CEO Jamie Dimon said, "Despite the rise in oil prices, it is fair to say that the global economy may be more resilient than many market participants, including me, expected." He cited research that energy costs account for a much smaller share of the economy than in the 1970s and 1980s, so energy costs have a smaller impact on the economy.

But this does not mean that there is no critical point for the impact of energy costs on the economy, but currently all parties are still far from the critical point. He also added, "The U.S. economy has been strong so far in 2026. The U.S. economy has shown significant resilience this year, with business investment and hiring even stronger.

This strength is supported by several tailwinds, including AI-driven capital investment, fiscal stimulus, and the benefits of more effective regulation." Jeremy Barnum, the bank's chief financial officer, said, "The labor market remains quite resilient.

So, it's not a dramatic turn in the second quarter, but on the margin, I would say the consumer was a bit stronger this quarter." Bank of America CEO Brian Moynihan also said that the second quarter was one of the bank's strongest quarters to date. "Overall, U.S.

economic growth has proven more durable than expected thanks to strong consumers, continued AI-driven investment across the board, and falling energy costs, although inflation and tight monetary policy remain major risks." He said, "Against a healthy economic backdrop, resilient consumers and businesses are turning to U.S.

banks for spending, borrowing, and investing." Alastair, the bank's chief financial officer Borthwick said that although geopolitical tensions have caused some instability in the overall market, the bank is still encouraged by the near-term outlook because "the biggest risk is that the economy goes wrong, but the biggest driver now is that consumers remain

resilient and perform very well." Wells Fargo CEO Charlie Scharf gave a positive outlook, saying that the overall economic environment is strong and is good for the growth of all businesses.

"We clearly benefit from the broad economic strength of the United States." He also cited the bank's removal of asset caps, a legacy of regulatory woes under his predecessor, including the fake accounts scandal. Mike Santomassimo, the bank's chief financial officer, said that despite oil price fluctuations, consumption trends are very resilient.

"If inflation ends up being much higher than market expectations, or interest rates end up having to be much higher than expected, for whatever reason, including the impact of oil, then I think that's going to have some kind of impact on consumers and the overall economy. But we haven't seen any signs of that materializing yet," he said.

Investment banking business records best quarterly performance in years In the second quarter, investment bank fees experienced the largest increase in history: Goldman Sachs increased by 55% to US$3.4 billion, about US$610 million higher than expected; JPMorgan Chase increased by 30% to US$3.3 billion; Bank of America increased by 50% to US$2.1 billion.

Goldman Sachs said the increase was mainly due to strong performance in initial public offerings (IPOs) and secondary offerings, bond issuance, equity underwriting, and increased consulting revenue. Importantly, its backlog increased compared to the previous quarter and last year.

Dimon said all of the bank's major businesses achieved record revenue in the second quarter. Bank of America reported net interest income of $16.2 billion, up 9%, helped by global market activity and higher loan and deposit balances. Moynihan also said that the second quarter was one of the bank's strongest quarters to date.

"Each business unit recorded double-digit net income growth and strong return on equity, with earnings per share increasing 34% year-on-year." Borthwick also said that the bank's investment portfolio generally showed positive and healthy signs.

"Consumer average deposits and loans increased, while asset quality remained healthy and in line with our expectations. Consumer investment assets increased nearly 20% compared with last year." Citi reported its best quarterly earnings in a decade, with four of the company's five businesses posting double-digit revenue growth.

Citi CEO Jane Fraser said in a statement: "Our growing profitability will increase our planned dividend by 12%, and we have initiated a $30 billion repurchase program.

Our combination of investments, disciplined execution and focus on clients is improving our returns and creating more durable performance for our investors." A major source of Goldman's results this quarter was trading. Revenue from Goldman's trading desk surged, with equities revenue rising 72% to $7.42 billion, about $2.3 billion above estimates.

Fixed income also rose 32% to $4.59 billion, about $880 million above expectations. Goldman Sachs CEO David Solomon said the bank's trading backlog is at its highest level in five years, which bodes well for revenue in the coming quarters.

AI is making a difference Dimon said that he will use AI to provide better services to customers and expects that this technology will be able to produce huge efficiency improvements in certain departments of the company. He said that the bank has nearly a thousand AI use cases and that this trend has only just begun.

He added that as of the end of June, JPMorgan Chase had 320,560 employees, basically the same as in the first quarter. JPMorgan Chief Financial Officer Jeremy Barnum also said the bank is now benefiting from the AI theme. In his view, "There is a booming environment in the AI field, there is a lot of activity, big IPOs, big index rebalancing.

AI has had an impact in all aspects of financial markets, and maybe we are starting to see some impact in the real economy as well." Moynihan also talked about the growth and opportunities in AI during a conference call with analysts as the bank develops more tools. Solomon said AI can make people more productive but should not impact headcount.

Fraser said AI was helping the bank drive growth and that its corporate clients were "real resilient". (

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