Wall Street Banks Post Record Stock Trading Profits Amid Trump-Led Global Volatility

NEW YORK — Wall Street’s biggest banks have reported record stock trading revenues in the first quarter of 2025, as a wave of political and economic uncertainty under President Donald Trump’s renewed administration fuels massive market volatility.

Goldman Sachs, Morgan Stanley, JPMorgan Chase, and Bank of America each posted their highest-ever quarterly earnings from equities trading, driven by fast-moving global shifts, trade policy upheavals, and investor repositioning across asset classes. Collectively, with Citigroup and Wells Fargo, the top six U.S. banks generated a combined $16.3 billion in stock trading revenue, marking a 33% increase compared to the same quarter last year.

The performance eclipses revenue levels seen during previous high-volatility periods, including the onset of the COVID-19 pandemic and the 2008 financial crisis.

“We obviously saw significant moves in equity markets as people positioned for a different kind of trade policy,” said David Solomon, CEO of Goldman Sachs, during Monday’s earnings call. “The business is performing very well, and clients are very active.”

Trading Booms While Deal-Making Lags

The spike in trading profits stands in stark contrast to the muted investment banking environment. Despite early expectations that Trump’s pro-business stance would spark a wave of corporate mergers, acquisitions, and IPOs, deal activity has remained subdued.

“While investment banking has stayed quiet, trading desks have been incredibly busy,” said Ted Pick, CEO of Morgan Stanley. “Clients have had plenty of reasons to adjust portfolios and manage risk exposure.”

Market activity intensified immediately after Trump’s inauguration in January, when he moved quickly to reintroduce tariffs on imports from Canada and Mexico. In the following weeks, trade tensions with China escalated again, with additional duties imposed on key sectors like automotive and steel.

By early April, the administration’s sudden rollback and reimplementation of sweeping trade measures—referred to internally as “Liberation Day” policies—sparked large swings in both equity and bond markets, contributing to a surge in institutional trading volume.

Banks Gain; Regional Lenders Lag Behind

While trading floors in New York and Chicago have been thriving, regional banks—which typically lack substantial trading operations—have struggled to keep up. Analysts point to stagnant loan growth, elevated default rates, and an overall weaker outlook for smaller financial institutions.

“It's a tough spot for regional banks,” said James Shanahan, a banking analyst at Edward Jones. “They’re missing out on the primary revenue stream that’s lifting Wall Street right now.”

Larger banks are also preparing for tougher times ahead. JPMorgan Chase revealed in its earnings report last week that it anticipates U.S. unemployment to rise to 5.8% by year-end, compared to 4.2% in March, potentially requiring them to set aside billions in reserves for loan losses.

Strong trading performance is expected to offset those provisions, helping Wall Street remain resilient in the face of economic softening.

Volatility as a Revenue Engine

Trading profits were primarily driven by institutional investors such as hedge funds and pension managers, who increased their exposure to equities, currencies, and commodities amid global uncertainty.

Fixed income desks also benefited from a pickup in bond trading activity, while demand for leverage and credit lines from clients remained robust.

Rather than taking large risks with their own capital—a hallmark of pre-2008 behavior—banks are now focused on market-making and client facilitation, profiting from transaction volume in volatile markets.

“We’ve been working with clients nonstop,” Pick added. “The ability to provide liquidity and credit in turbulent times has become one of our biggest strengths.”

Outlook: More Volatility Ahead

With trade policy still in flux and global markets on edge, analysts say the second quarter could be even more lucrative for Wall Street’s top banks.

“There’s no indication that the volatility is slowing down,” Shanahan said. “That means trading desks will likely stay busy and continue driving profits.”