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Wall Street’s biggest banks just posted a record first half, turbocharged by stock trading, dealmaking, and financing tied to the AI boom.
The country’s five largest Wall Street banks — JPMorgan Chase (JPM), Bank of America (BAC), Citigroup (C), Goldman Sachs (GS), and Morgan Stanley (MS) — collectively reported $114 billion of capital markets revenue in the first six months of 2026, up 31.5% from a year earlier. Stock trading accounted for more than half of the increase.
The windfall showed just how deeply the AI frenzy is feeding Wall Street’s profit machine. It also raises the big question: How much does the sector’s momentum depend on the AI revolution?
AI is the “No. 1 earnings driver” for big banks this year, Wells Fargo analyst Mike Mayo said in an interview. He compares the capital demands from tech firms, utilities, and related industries to a “100-foot wave” lifting Wall Street.
“Big waves can cause big falls,” Mayo said, but added he doesn’t expect a wipeout over the next year.
Executives over the past week said AI is fueling a cycle of lucrative Wall Street activities. “The market is clearly extremely risk-on, and we’re kind of takers of that,” JPMorgan CFO Jeremy Barnum noted on Tuesday. He added it was “a little bit hard to imagine” the bank’s trading business repeating its record haul.
“It’s getting close to as good as it gets,” CEO Jamie Dimon said about the current banking environment.
Sharp price moves, heavy stock rotation, and higher investor balances pushed equities trading revenues to new heights. Newfound AI wealth is also pouring into wealth management. Morgan Stanley CFO Sharon Yeshaya said “over half” of its wealth business’s net new assets came from employees of companies that did IPOs in the quarter.
That enables banks, which hauled in hefty fees for underwriting AI deals, to make money long after the headline-grabbing IPOs.
The biggest contributor to the record first half came from Goldman Sachs, which saw a $7.1 billion rise in capital markets revenue after advising on SpaceX’s IPO and Alphabet’s equity raise.
“We’re early in the cycle to build out, but it won’t be without bumps and recalibrations,” CEO David Solomon said of the AI boom on Tuesday.
Morgan Stanley estimates the broader AI build-out will amount to $10 trillion in spending over multiple years. As the cycle rolls on, more of that spending is expected to move beyond Big Tech’s cash flow and into public debt, equity, private credit, and other financing channels.
“We’re around 10% to 15% of the way through the investment cycle,” CEO Ted Pick said Wednesday.
