New York (CNN Business)Goldman Sachs revealed a 41% surge in revenue Wednesday as the Wall Street bank capitalized on booming markets and a flurry of dealmaking.
The stronger-than-expected results were driven by record investment banking revenue and a nine-year high for its trading arm. Goldman’s robust quarter underscores the bifurcated rebound in the United States from the pandemic. Although unemployment remains high and bankruptcies are mounting, the red-hot stock market has largely recovered and companies are raising record sums of money in capital markets.
Wells Fargo lost $2.4 billion last quarter, setting the stage for its first dividend cut since the Great RecessionThat backdrop plays perfectly to the strengths of Goldman Sachs, which is far more exposed to Wall Street than Main Street. Goldman Sachs (GS) reported revenue surged to $13.3 billion, blowing away estimates of $9.8 billion. It was Goldman’s second-highest quarterly revenue ever. Read MoreAlthough net earnings were flat at $2.4 billion, that stands in stark contrast to the sharp declines in profit reported Tuesday by JPMorgan Chase (JPM) and Citigroup (C). Wells Fargo (WFC), the big bank most closely tied to Main Street, suffered a loss. Per-share profit rose 8% at Goldman Sachs to $6.26, far exceeding expectations for $3.78.
Goldman Sachs CEO David Solomon acknowledged the “very challenging environment” and said the economic outlook “remains uncertain.”Shares of Goldman Sachs rallied 4% premarket on the earnings beat. The bank is only down 7% so far this year, compared with a 36% plunge for the KBW Bank Index (BKX).
Source: edition.cnn.com
