Wall Street banks eye ‘new normal’ for trading revenue – Reuters

Wall Street banks eye ‘new normal’ for trading revenue – Reuters

NEW YORK, Jan 19 (Reuters) - Wall Street banks are expecting trading revenue to settle at a "new normal" somewhere between pre-pandemic levels and the highs of the past two years, top executives and analysts say.

A massive injection of cash into capital markets by the Federal Reserve led to unprecedented liquidity and trading activity through the pandemic as investors sought opportunities to cash in. But trading revenue at leading Wall Street banks fell in the fourth quarter as markets normalized and the Fed scaled back its asset purchases. read more

Banks with large trading desks such as Goldman Sachs (GS.N), JPMorgan (JPM.N) and Morgan Stanley (MS.N) have been the biggest beneficiaries of market volatility, enabling traders to enjoy their best period since the 2007-09 financial crisis.