Wall Street feasts on fees from SpaceX IPO and mega-mergers

{"text":[[{"start":10.1,"text":"Wall Street banks this week are set to report their biggest haul from investment banking fees in four and a half years, fuelled by SpaceX’s blockbuster stock market listing and a resurgence in mega-mergers."}],[{"start":22.799999999999997,"text":"The five largest US investment banks — JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America and Citigroup — are forecast to report a year-on-year fees increase of 27 per cent in the second quarter, according to estimates compiled by Bloomberg. "}],[{"start":39.199999999999996,"text":"This would take the total to $11.1bn — the largest since 2021, the industry’s recent high-water mark."}],[{"start":47.39999999999999,"text":"The windfall comes after US stocks logged their best quarter in six years despite the volatility and uncertainty sparked by the Iran war. The AI investment boom, lower oil prices and signs of consumer resilience helped fuel the rally in the three months to the end of June."}],[{"start":65,"text":"A big part of the gains comes from fees in equity capital markets, which are predicted to total $2.5bn across the five banks. This is mainly thanks to the $500mn in fees received by the 23 investment banks on SpaceX’s IPO, the highest ever paid on a public offering. Goldman and Morgan Stanley each pocketed $100mn from the deal."}],[{"start":87.15,"text":"“SpaceX was such a large deal, we do expect it to have a measurable impact across all the banks that were involved,” said Brian Mulberry, chief market strategist at Zacks Investment Management."}],[{"start":null,"text":"

"}],[{"start":97.55000000000001,"text":"Bankers and analysts have highlighted the mammoth scale of a new cohort of tech companies that have or may soon go public, including SpaceX, OpenAI and Anthropic."}],[{"start":109.25000000000001,"text":"Listings for smaller companies held by private-equity owners have been more muted, however, because of higher interest rates."}],[{"start":116.40000000000002,"text":"Fees from mergers and acquisitions across the five banks are also forecast to jump about 30 per cent from the second quarter of last year to more than $4bn — the first time since 2021 that fees remained above that level for three consecutive quarters."}],[{"start":132.3,"text":"Wall Street has benefited from a revival of large deals worth more than $10bn. Morgan Stanley wrote in a note to clients this week that 2026 global M&A announcements were tracking towards the highest volumes on record."}],[{"start":146.05,"text":"JPMorgan, Goldman, Morgan Stanley, BofA, Citi and Wells Fargo all report earnings on Tuesday, with Morgan Stanley following on Wednesday. Together, the six banks are expected to report second-quarter profits of about $44bn, up 18 per cent from a year ago."}],[{"start":null,"text":""}],[{"start":164.20000000000002,"text":"Their trading divisions are also poised to benefit from volatile financial markets, facilitating and financing transactions for clients. Growth is particularly strong in equities trading."}],[{"start":175.60000000000002,"text":"Growth in investment banking divisions has come amid relatively muted losses from lending, boosting bank stock prices which have outperformed the broader market in the past two years. This has raised questions over how much upside remains for bank stocks."}],[{"start":190.15000000000003,"text":"“The bar is higher,” said Saul Martinez, head of US financials equity research at HSBC. “This should be a good quarter, but I think the market is expecting that and you have seen that in the stock prices.”"}],[{"start":202.45000000000005,"text":"Investors will also continue to scrutinise banks’ balance sheets for signs of stress on US consumers, who have proven relatively resilient to shocks including import tariffs, the war with Iran and higher oil prices."}],[{"start":216.55000000000004,"text":"“The concern would be more if you saw a re-escalation [of the conflict], oil prices shot back higher, inflation comes back into the picture and then you start to worry about the economic growth,” said Martinez."}],[{"start":236.15000000000003,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1783933902_4056.mp3"}