WSJ: BAC HAS A VERY LUCRATIVE 2Q THANKS TO STRONG TRADING, UNDERWRITING, MERRILL, COUNTRYWIDE
By Daniel at 4 July, 2009, 3:04 am
WSJ reports the securities cos still standing on Wall Street are about to close the most lucrative quarter since the credit crisis erupted.
And instead of relying on risk and leverage to drive profits, companies such as J.P. Morgan (JPM), Goldman Sachs (GS), Morgan Stanley and Bank of America (BAC) are getting back to basics, with a strong performance from trading and underwriting.
Investor confidence in the debt markets fueled issuance of $1.5 trillion globally from the start of the second quarter through Monday, according to Dealogic. That was slightly lower than in the first quarter, but the latest results showed a rebound in high-yield issuance.
Equity offerings reached nearly $260 billion during the second quarter, which ends Tuesday. That is almost four times the amount recorded during the first quarter, and the highest since 2008’s second quarter, Dealogic said. In trading, the gap between bid and offer prices on fixed-income assets remained wide through most of the quarter, boosting profits from buying and selling these securities. Fixed-income trading is one of the main earnings drivers for big Wall Street cos.
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