Earnings Previews Q2: Bank of America Corp, Goldman Sachs Group Inc

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The second quarter earnings reporting period shifts into gear this week, with the first major tech firm, Netflix, to report tonight. Bank earnings started last week, but tomorrow morning, we’re expecting the Bank of America Q2 2017 and Goldman Sachs Q2 2017 reports. Citigroup and Wells Fargo reported on Friday and provide some hints about what to look for from the other financial firms reporting this week, but here’s what to expect from Bank of America and Goldman Sachs.

Bank of America Q2 2017 earnings

Bank of America Q2 2017 earnings
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In tomorrow morning’s Bank of America Q2 2017 earnings report, Wall Street is expecting to see earnings of 43 cents per share on $21.9 billion in revenue. In last year’s second quarter, the bank posted earnings of 36 cents per share on $20.4 billion in revenue.

Analysts are generally expecting a decline in trading revenue at Bank of America as fixed income, currencies and commodities leads the way and equity trading declines. On the plus side, however, they’re looking for increases in fees for the firm’s traditional banking, mortgage banking and brokerage businesses. Other areas of expected strength include advisory services for investment banking, equity underwriting, and debt underwriting.

Bank of America is also widely seen as being highly sensitive to the yield curve, which was steepening as volatility increased late in the second quarter. Some analysts highlighted that this sets the firm up for a potentially stronger second half of the year, although others noted more recently that the yield curve is again being pressured.

On Monday before the Bank of America 2Q 2017 earnings report, which is set for Tuesday morning, the firm’s stock ticked lower by as much as 0.74% to $24.03 per share.

Goldman Sachs Q2 2017 earnings

Goldman Sachs Q2 2017 earnings
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Tomorrow’s Goldman Sachs Q2 2017 earnings report is expected to reveal $3.51 per share in earnings and $7.57 billion in revenue. The firm missed estimates for the first quarter due to higher-than-expected expenses and a big year over year decline on the bottom line. Goldman recorded lower revenues on equities, while fees for underwriting boosted its results, according to Zacks. Volatility was low during the first quarter, although Goldman should have benefited from the volatility boost late in the second quarter.

During the second quarter, Wall Street expects Goldman Sachs to have recorded a year over year decline in trading revenues due to low volatility in both the equity and bond markets. Additionally, Zacks points out that Brexit drove an unusual second quarter last year, so the comparisons will be rather skewed because of that.

Goldman also likely faced headwinds due to a slowdown in the merger and acquisition industry, debt underwriting, and investment banking. However, the firm likely benefited from higher equity underwriting fees.

Ahead of the Goldman Sachs Q2 2017 earnings release, the firm’s stock ticked higher by as much as 0.42% to $229.51 during regular trading hours on Monday.

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