Investor attention is firmly fixed on the banking sector this week as the six largest US lenders prepare to disclose their fourth quarter financial results. Wall Street anticipates a significant boost in profits, driven primarily by a resurgence in investment banking and an acceleration in global dealmaking revenue during the final months of the year 2025.
The earnings season kicks off on January 13 with the America’s largest lender, JPMorgan Chase scheduled to report Q4 results. This will be followed by Citigroup, Bank of America, and Wells Fargo on January 14. The cycle concludes with reports from Goldman Sachs and Morgan Stanley on January 15. The S&P bank index, which surged 30% last year, has maintained momentum with a 3% gain so far in 2026.
Investment Banking Rebound
Results are expected to reflect a robust revival in mergers and acquisitions (M&As). According to a Reuters report citing Dealogic data, investment banking revenue rose 15% year-over-year to nearly $103 billion — the second-highest level since 2021. Total M&A transaction volume hit $5.1 trillion in 2025, a 42% increase from 2024, propelled by massive megadeals.
JPMorgan Chase topped the investment banking league tables, while Goldman Sachs secured the top position in M&A rankings.
Trump Policies Effect
While the market participants anticipate long-term growth from US President Donald Trump’s pro-business agenda — including lighter regulation and tax changes — the sector faced immediate headwinds on Monday.
The bank shares tumbled after President Donald Trump called for a 10% interest rate cap on credit cards for one year, starting from January 20.
Market Reaction
On Monday at 12:43 p.m. EST, stocks of Citigroup tumbled 3.5%, and JPMorgan Chase fell 2%, Bank of America declined 1.74%, Wells Fargo lost 2.09%, Goldman Sachs was slightly up 0.05%, and Morgan Stanley was down 0.77%.
Despite this short-term pressure, the banks industry remains optimistic that a friendlier regulatory environment and continued economic growth will bolster lending profitability throughout the coming year.
