Don’t bank on the banks

[Nadilapars]

 

Earnings season is upon the big 6 US banks and that will have an impact on share prices which will also be affected by the Trump administration’s ability to pass new tax legislation through Congress  

As earnings season edges closer banks top the agenda as investors look at sector’s biggest names to assess their potential. 

JPMorgan (JPM) and Citigroup (C) release their figures first. They were followed by Wells Fargo (WFC) and Bank of America (BAC) then Goldman Sachs (GS) and Morgan Stanley (MS). 

US banks have benefited recently from a perceived likelihood of interest rate increases from the US Federal Reserve. However, much of these banks’ future performance will depend on the tax cuts that US President Donald Trump proposed recently, and the ability of his administration to get them through Congress. 

If passed, net income of the big six banks could rise $6.4 billion.

Wells Fargo, Bank of America and JPMorgan will be the biggest beneficiaries, according to Bloomberg. 

However, Trump’s administration has been frustrated by Congress’ unwillingness to back his proposed policies.

 

 

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