Wall Street’s largest banks delivered second-quarter results that far exceeded analyst forecasts, propelled by a dealmaking revival and frenetic trading activity. JPMorgan Chase posted the highest quarterly profit ever recorded by a US bank, while Goldman Sachs’s net income jumped 78 per cent to $6 billion and Citigroup’s rose 45 per cent. Bank of America and Wells Fargo also surpassed expectations, confirming that the investment banking drought has broken and that market volatility has become a significant source of revenue.

The surge drew on a confluence of forces. Global investment banking revenues climbed 24 per cent in the first half of 2026 to $61.4 billion, according to Dealogic data, as a pipeline of mega-IPOs and block trades came to market. The SpaceX listing, the largest in history, generated roughly $500 million in fees for the syndicate of banks, with top-tier firms each pocketing $75–100 million. The Cerebras IPO and an $85 billion Alphabet stake sale added to the windfall. At the same time, equity and fixed-income trading desks capitalised on sharp price swings triggered by the US-Iran conflict, uncertainty over the AI revolution, and shifting interest-rate expectations. In Moscow, financial media linked the earnings bonanza directly to the war with Iran, highlighting profits from oil-price gyrations and currency fluctuations.

JPMorgan now commands a market capitalisation above $920 billion, edging closer to the trillion-dollar club, while Goldman Sachs cemented its lead in global M&A advisory. European observers described the US economy as one that “refuses to die”, with strong consumer demand and AI investment offsetting tariff and geopolitical headwinds. Yet the same executives who celebrated the numbers also sounded notes of caution. JPMorgan’s chief financial officer, Jeremy Barnum, questioned the “fragility and danger” of current conditions, pointing to highly leveraged investment volumes and “very high” corporate valuations. Bank of America’s CEO, Brian Moynihan, warned that inflation and tighter monetary policy remain key risks, while Wells Fargo’s chief, Charlie Scharf, reminded investors that “strong conditions like these don’t last forever”.

Morgan Stanley is set to report on Wednesday, and attention will focus on whether its wealth management and trading arms matched the industry-wide surge. The deal pipeline remains robust, but Citigroup’s finance chief cautioned that the Middle East conflict could eventually weigh on transaction activity. Meanwhile, analysts at Morgan Stanley and Goldman Sachs have sharply cut their 2026 oil-price forecasts, expecting Brent to average $80 a barrel by year-end, a $10 reduction that signals easing energy costs but also a potential dampener on the volatility that has so benefited trading desks. The Federal Reserve’s next move on interest rates, against a backdrop of sticky inflation, will be the next major test of the banks’ ability to sustain their momentum.