US bank stocks mostly lower as executives paint gloomy growth picture

September 12, 2024 05:13 AM AEST | By Investing

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US bank stocks mostly lower as executives paint gloomy growth picture

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Investing.com -- U.S. bank stocks fell Wednesday, as banking executive continued warn of a slower recovery in investment banking.

Citigroup Inc (NYSE:C), Wells Fargo &Company (NYSE:WFC), and Morgan Stanley (NYSE:MS) were in the red in recent trading, while

JPMorgan Chase&Co (NYSE:JPM) and Goldman Sachs Group Inc (NYSE:GS) were marginally higher.

Speaking at a financial conference, Morgan Stanley President Dan Simkowitz said he expects

lower interest income in the third quarter, adding to the negative chorus about the Wall Street banking outlook from the executives at Citigroup, JPMorgan and Goldman Sachs.

Simkowitz also said that M&A and IPO activities will continue to lag behind historical trends through the end of the year.

Earlier this week, JPMorgan Chase&Co said that analysts forecasts for next year’s net interest income were too optimistic, while Goldman Sachs warned that trading revenues would be 10% lower in Q3 from a year earlier.

Citigroup's CFO Mark Mason on Monday, meanwhile, warned that markets revenue was likely to drop 4%.

The negative sentiment on Wall Street banks was compounded after Warren Buffett's Berkshire Hathaway (NYSE:BRKa) announced in regulatory filing that it had sold more shares, cutting its stake in the bank to 7%.

But it wasn't all negative for news for banks so far this week after they scored a reuglatory reprieve as the Fed proposed to make changes to plans that would have required banks to increase the amount of regulatory capital held.

"Overall, the re-proposal is less onerous on all banks with more than $100 billion in assets and the increases in required capital levels will be much lower than called for in the original proposal," RBC said in a recent note.

This article first appeared in Investing.com

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