Capital Market Strength Seen Bolstering Banks As Goldman Sachs, Bank Of America, Morgan Stanley To Report

Capital Market Strength Seen Bolstering Banks As Goldman Sachs, Bank Of America, Morgan Stanley To Report

Key Takeaways:



Surging IPO and M&A business still appears to be helping big banks

Strong trading activity could bolster Goldman Sachs, Morgan Stanley, Bank of America

Customer loan book activity seen key to assessing health of many banks' businesses



Big investment banks could have a tough time matching their incredibly strong Q3 earnings performance when they report Q4 results next week. However, you could argue that the conditions leading to their muscular Q3 earnings spilled into Q4.

An upsurge in capital markets trading activity and a very strong initial public offering (IPO) market could bode well for Q3 outperformers Goldman Sachs (GS



GS

) and Morgan Stanley



MS

(MS). However, the more consumer-oriented Bank of America



BAC

(BAC) might face continued challenges, according to analysts' sagging estimates for the company.



Though Monday is a holiday, the bank sector comes out swinging Tuesday morning when BAC and GS are expected to report. MS is expected to follow on Wednesday morning.

Like the rest of 2020, Q4 probably was good for banks in one particular way: All the