Goldman Sachs beat the first quarter profit estimates, since its operators took advantage of market volatility to obtain record income for variable income. However, Bank’s executive director warned about a difficult environment.
The Wall Street bank joined its rivals JPMorgan Chase and Morgan Stanley by reporting greater profits, but investors are more focused on future projections, since tariffs increase inflation and recession risks.
“While we enter the second quarter with a significantly different operational environment from this year, we continue to trust our ability to continue supporting our clients,” said executive director David Solomon, who highlighted the “great uncertainty” that was cerrious over the markets during the first quarter.
Goldman’s profits increased by 15%, to 4,740 million dollars, or $ 14.12 per share, during the quarter ended on March 31, the bank reported Monday.
The average estimation of earning analyzes was $ 12.35 per share, according to data collected by LSE. The bank’s shares rose 1%, to 499.26 dollars.
The turbulence in the markets promoted Goldman’s revenues due to Variable Income Operations by 27%, reaching a record of 4.2 billion dollars, while investors rushed to restructure their portfolios to mitigate the impact of new tariffs.
“Our customer dialogues are still intense, and our request for orders has increased for fourth consecutive trimester,” said Solomon, referring to agreements of agreements. “That said, our ability to execute these transactions will depend, of course, on market conditions.”
Continuous political uncertainty and market volatility are promoting customers to reposition their portfolios, which drives greater commercial activity, he added.
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This change underlines a drastic turn in the perception of a sector that, until just a few months ago, celebrated the return of US President Donald Trump to the White House.
“I don’t think the investment bank is dead,” said Chris Marinac, research director of Janney Montgomery Scott. “It will simply be slower and, without a doubt, it will not be so robust.”
When referring to the drastic measures of economic policy of the administration, Solomon highlighted how the United States has benefited from the trade and the role of the dollar as a reserve currency.
“The administration approach in commercial barriers and the strengthening of the United States competitive position is commendable,” he said. However, it is important to note that few “have benefited more of the economic and financial order after World War II than the United States.”
Goldman’s shares fell 12% since the tariffs were announced earlier this month, while their JPMorgan and Morgan Stanley rivals dropped 4% and 9%, respectively.
However, the concern had already emerged even before the last fall. The Oppenheimer Bolsa house reduced the qualification of Goldman’s actions in March, warning that the aggressive efforts of the Trump administration for changing global commercial standards could affect a series of companies that depend on the activity of capital markets.
With Reuters information
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