Big banks enter the Trump era on a high note: Morning Brief

Published On Jan 16, 2025, 6:00 AM

The article discusses how major U.S. banks have reported record profits and a positive outlook following the election of Donald Trump as President. Banks like JPMorgan Chase, Goldman Sachs, and Wells Fargo experienced significant profit increases, fueled by expectations of a pro-growth policy shift under Trump. While these banks performed well during the previous administration, they anticipate even greater growth opportunities with less regulatory oversight and supportive fiscal policies, such as potential tax cuts and deregulation. Executives believe that a more favorable business environment could boost financial activity and corporate mergers, as lending margins remain healthy even in lower interest rate environments.

Stock Forecasts

JPM

Positive

With the expectation of a more pro-growth agenda under Trump's administration, big banks are likely to continue experiencing strong demand for their services, potentially leading to sustained profit growth. Additionally, the predicted regulatory easing could facilitate corporate mergers and enhance the banks' profitability. Therefore, investments in well-performing banks such as JPMorgan Chase and Goldman Sachs are seen as promising due to their resilient financial health and growth potential during this political shift.

GS

Positive

Goldman Sachs has shown a significant recovery and growth in profits, suggesting that its proactive strategy in deal-making and services could provide a good return on investment, especially with upcoming favorable market conditions. Their performance is pivotal for investors looking about entering the financial sector given the anticipated market and policy changes.

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