According to Woofun AI, Wall Street investment banks showed a significant pattern of business differentiation in the third quarter: Goldman Sachs (GS.US) established an advantage with strong performance in stock trading, while J.P. Morgan Chase (JPM.US) was plagued by weakness in the bond business. This contrast is not only reflected in revenue growth, but also reflects differences in trading activity between different asset classes in a high interest rate environment.
According to data compiled by Woofun AI, Goldman Sachs stock trading revenue increased 72% year over year to reach US$6.44 billion, almost double the revenue of its fixed income business of US$3.47 billion. Despite a 1% year-on-year decline in revenue from the fixed income business, revenue from the relevant segment covering these two businesses increased 32% to US$13.46 billion. Herman Chen, a senior US banking analyst at Bloomberg Intelligence, commented that Goldman Sachs was an industry benchmark in the third quarter.
Looking at J.P. Morgan Chase's bond business revenue was $5.4 billion, down 4% year over year. This was the first time in two years that the department experienced a decline and was more than $500 million lower than expected. Despite a 49% year-over-year increase in stock trading revenue to $5 billion, overall revenue and net profit fell short of expectations. Federal Reserve Bank of New York Governor Williams said that it seems appropriate to raise interest rates again this year and does not expect to raise interest rates in 2027; while most Federal Reserve officials support another rate hike in 2026, J.P. Morgan also expects a rate hike in December. In an environment of high interest rates, J.P. Morgan's net interest income increased 12.8% to $27.04 billion.
In terms of credit risk, Wells Fargo Bank (WFC.US) has set aside $1.03 billion for possible loan losses, up from $681 million last year. Herman Chan expects fourth-quarter transaction revenue to decline seasonally. The current growth momentum depends on artificial intelligence-related transactions. The sell-off in chip stocks occurred on Tuesday, which became a key variable affecting subsequent trends.