Banks are thriving so far in Trump's economy. Here's what that means for markets and the consumer

Core Insights - The financial sector is currently experiencing a surprisingly profitable environment, driven by strong performance in stock and bond trading, as well as increased corporate acquisitions and borrowing [2][3]. Group 1: Financial Performance - The six largest U.S. banks reported approximately $39 billion in profits for the second quarter, exceeding analysts' expectations and showing a more than 20% increase from core earnings year-over-year [3]. - JPMorgan Chase, the largest U.S. bank, generated about $15 billion in quarterly profit, nearly matching the combined profits of the next three largest banks [6]. Group 2: Market Dynamics - The quarter began with market turmoil due to President Trump's "Liberation Day" tariffs, which initially raised concerns about a potential recession [4]. - However, markets rebounded after Trump delayed the most severe tariffs, leading to increased corporate activity and investment banking transactions [5]. Group 3: Investment Banking Trends - Investment banking revenue at JPMorgan rose by 7%, surpassing analysts' expectations by $450 million, despite earlier warnings of a potential 15% decline [7]. - The increase in investment banking fees indicates that corporations are adapting to uncertainty and proceeding with transactions [8].