Big Banks affected by the decline in agreement

Big banks

Big banks faced profitability sinking due to a decline in making transactions and IPOs

Big banks will start the revenue season next week with JPMorgan, Citigroup, and Morgan Stanley hoping to report the results. Goldman Sachs will report the results the following week. Investors will pay attention to how to decrease sharply in the IPO and the manufacture of the deal reaches their underline.

With a sinking stock price and inflation and interest rates rise, it is increasingly difficult for companies to sell shares, making banks with the scarcity of the issor of emissions. The company that lists shares in the US through the IPO has collected only $ 4.8 billion this year, compared to $ 84 billion at this time last year. Global IPO volume dropped 46% with a result of 58% in the first half of the year according to EY.

Last year, the volume of global merger and acquisition was approaching $ 6 trillion, including a record of $ 1.56 trillion in the third quarter, according to Dealogic. This year, the agreement has dried up with investment banking revenue falling 36% in Goldman Sachs during the first quarter, and fell 37% at Morgan Stanley. Citigroup said they expect a 50% decline in investment banking income for the second quarter.

JPMorgan shares (JPM) dropped more than 30% this year, while Citigroup shares (C) fell 27%. Morgan Stanley (MS) share price dropped by around 25%. Goldman Sachs (GS) shares fell by about 26%.

“Bank shares usually work well when interest rates rise, but with fears of recessions that grow from day to day and less activities in the capital market, bank shares are lacking in work and tend to remain under pressure during the summer,”