Goldman Sachs’ stock traders have reported the largest revenue haul in Wall Street history, driven by volatility stemming from the Trump administration’s trade war. The second quarter saw a second consecutive record for the unit. Equity-trading revenue reached $US4.3 billion ($6.6 billion), approximately $US600 million above analyst expectations and $US100 million higher than the first quarter, according to a statement. This surge in trading revenue pushed the company’s overall profit above expectations for the period.
While trading desks across Wall Street generally benefited from the tariff upheaval, Goldman Sachs outperformed its competitors. Although Goldman’s stock-trading revenue increased compared to the previous three months, Morgan Stanley, Bank of America, and JPMorgan Chase experienced slight declines in their figures. Goldman Sachs has been focusing on expanding its trading business, which is one of Wall Street’s most profitable areas, amid increased competition from Morgan Stanley and market makers like Jane Street and Citadel Securities. Goldman Sachs is a leading global investment banking, securities and investment management firm that provides a wide range of financial services to a substantial and diversified client base. The company serves corporations, financial institutions, governments and individuals.
The firm’s fixed-income traders reported $US3.47 billion in revenue, supported by record results in FICC financing, while investment-banking fees jumped to $US2.19 billion. Goldman’s bankers saw a 71 per cent gain in financial-advisory revenue, driven by fees from mergers and acquisitions. Earlier in the month, Goldman Sachs increased its dividend by a third to $US4 after Federal Reserve stress tests. Furthermore, shareholders approved $US80 million retention bonuses for CEO David Solomon and President John Waldron.
Goldman Sachs shares rose 1.4 per cent in early New York trading. The company is also implementing a multiyear plan to lower operational costs, including trimming headcount by 700 people to 45,900 and relocating managers and partners to more cost-effective locations such as Dallas, Warsaw, and Bengaluru.
