WASHINGTON (AP) — Five major U.S. banks reported record profits Tuesday, helped by the surprising resilience of trading desks and U.S. consumers amid continued global economic uncertainty.
it is, 2 consecutive quarters The strong performance was highlighted by banks that have benefited from market volatility since the Iran war began in late February.
Both consumer and market-focused banks reported revenue and bottom-line growth that exceeded even the most optimistic Wall Street expectations.
Here’s a look at how and why banks have continued to grow despite an uncertain economic future.
JP Morgan sets a record
JPMorgan Chase & Co. posted a $16.9 billion profit in the second quarter as its equity trading unit once again took advantage of market volatility caused by the financial crisis. war in iran.
JPMorgan, the nation’s largest bank by assets, said revenue across all its business lines reached record levels, including its markets division, where revenue for the quarter rose 35% from a year earlier. Revenues in the stock market sector soared 86%.
JPMorgan earned $6.14 per share in the same period, beating analysts’ expectations of $5.59 per share. Managed revenue came in at $58 billion, which also exceeded the expectations of analysts surveyed by FactSet.
JPMorgan shares were up 1.8% by midday.
Consumers remain strong
Bank executives emphasized that U.S. consumers are doing surprisingly well, even though inflation remains high, due in part to soaring oil prices due to the Iran war.
Bank of America announced that consumer spending expanded more than expected. The bank said consumer investment assets rose 18% from a year ago, and average deposits and average spending all increased from the first quarter.
During the same period, JPMorgan reported revenue from its consumer banking division of $20.3 billion, an 8% increase from the same period last year.
Wells Fargo also reported improved consumer activity, reflecting a generally healthy U.S. economy.
“Consumer spending is up, charge-offs and delinquencies are down, and savings and investments are increasing across consumer segments,” said Wells CEO Charlie Scharf.
However, unresolved conflicts in the Middle East remain a potential economic hurdle for consumers and businesses alike.
Oil prices fell to near pre-war levels earlier this month, but have rebounded more than 10% this week due to lower U.S. oil prices. New attack on Iran And President Donald Trump announced a new blockade of the Strait of Hormuz, a key shipping route that transports about a fifth of the world’s oil. Gasoline prices are $3.86 a gallon, still well above prewar levels but below May’s peak of about $4.50.
Dimon said on the conference call that JPMorgan remains “appropriately cautious” given current global economic risks.
“We cannot predict how these forces will ultimately develop,” Dimon said. “While they may still be manageable, they can also cause significant disruption if they move or collide.”
IPOs and mergers expected to be active until 2026
Dimon said New York Bank’s investment banking division’s revenue rose 30%, accelerating to its highest level since 2021 as appetite for initial public offerings and M&A remained strong.
All major banks played a role in SpaceX’s record IPO in June, with Goldman Sachs and Morgan Stanley serving as lead underwriters. The initial public offering will bring in $75 billion, more than all U.S. IPOs in 2024 and 2025 combined, according to Renaissance Capital.
Renaissance expects the strong growth in the IPO market to continue into the second half of this year, boosted by large deals such as South Korean memory chip giant SK Hynix’s $26.5 billion “super-sized listing” on Friday.
According to Morgan Stanley, global merger and acquisition activity also accelerated in the second quarter of 2026, with announcements increasing 64% and deals closing 33% compared to the same period last year.
Goldman Sachs said its merger and acquisition advisory revenue rose 17% in the second quarter.
Iran war is the main cause of market fluctuations
Markets have been up and down since the United States and Israel attacked Iran in late February, with military strikes by both sides interspersed with pauses in fighting and vague truces.
Investor concerns that the war would be prolonged led to heavy selling in financial markets, while hopes for a resolution and free flow of oil prompted optimism and buying.
Volatile markets can cause anxiety for retail investors, but Wall Street’s high-velocity trading desks can take advantage of the wild swings. Significant market movements tend to increase trading desk activity, leading to increased fees and commission income for banks.
Goldman Sachs said its Banking & Markets division’s revenue for the period was $15.52 billion, a 53% increase compared to the second quarter of last year and a 22% increase compared to the first quarter of 2026.
Citigroup’s market revenue also beat first-quarter numbers, increasing 45% year-over-year.
Overall strong second quarter results
Wells Fargo reported a 22% increase in net income for the quarter to $6.4 billion. Revenue of $22.6 billion exceeded Wall Street expectations.
Scharf said San Francisco Bank is benefiting from a strong economy and new investment capacity after years of government oversight. Wells Fargo stock was down 2.6% as of midday.
Goldman Sachs earned $6.6 billion, or $20.98 per share, on revenue of $20.3 billion in the quarter. The company’s stock price rose more than 7%.
Bank of America’s profits rose 27% from a year earlier to $9.1 billion. Bank of America stock rose 1.7%.
Citigroup also posted sales and profits that beat Wall Street expectations, but its stock fell 4.5%.
