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Saturday, Oct 24, 2026

The big bank winning streak might be about to end

The big bank winning streak might be about to end

The biggest American banks report earnings this week, and they will probably be hampered by weaker economic growth and lower interest rates. The Federal Reserve cut interest rates in July and again in September, making it more difficult eke out returns on loans.

The dour earnings expectations mark a change from the previous quarter, when big banks returned fat profits despite worries about an economic downturn in the United States.

Tuesday is the big day. Investors will hear from Citigroup, Goldman Sachs, JP Morgan Chase and Wells Fargo before the opening bell. Bank of America follows on Wednesday.

"We are in challenging times for large banks, where the pulse of investor activity may often impact the large banks asset and wealth management units," CFRA Research's Kenneth Leon wrote in a research note.

Leon said that the tone of the bank earnings calls is likely to be "subdued" as executives struggle to find a silver lining, with investment banking fees continuing to drop and ongoing geopolitical uncertainty.

One more headache: A sudden price war has seen every major online broker eliminate commission fees on stock and ETF trades. According to Leon, that trend does "not bode well" for investment banks and brokerage firms that depend on retail trading commissions.

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