JPMorgan Chase expects investment banking fees and trading revenue to rise by the mid-to-high teens percentage range in the third quarter, offering investors a stronger outlook after recent concerns about the health of Wall Street businesses. Co-President Doug Petno said the bank was seeing broad-based strength across its investment banking and markets divisions.
The forecast immediately attracted attention because it contrasted with a more cautious outlook from Bank of America. That warning had triggered a sell-off in large US bank stocks, making JPMorgan’s comments particularly important for the wider financial sector. JPMorgan shares recovered from earlier losses and closed about 0.7% higher after Petno spoke at the Barclays Global Financial Services Conference.
Petno said investment banking fees and markets revenue were expected to increase by the mid-to-high teens compared with the third quarter of 2025. The forecast includes a seasonal decline from the record second quarter, but still points to strong year-on-year momentum across the bank’s Wall Street operations.
The outlook is supported by what JPMorgan described as a robust deal pipeline. Petno said activity was broad-based and that management confidence was helping drive a significant amount of mergers and acquisitions. He added that deal activity was as strong as the bank had seen in some time.
That comment points to a gradual return of confidence among corporate executives and boards. Companies often delay large acquisitions when interest rates, economic growth or geopolitical conditions are uncertain. When leaders become more confident about the outlook, they are more willing to pursue strategic transactions, raise capital or restructure their businesses.
Mergers and acquisitions are an important source of revenue for investment banks. Advisers earn fees for helping companies identify targets, negotiate transactions, arrange financing and complete regulatory processes. A stronger M&A market can therefore support several parts of a bank’s business at the same time.
JPMorgan’s investment banking fees rose 30% from a year earlier in the second quarter. Markets revenue increased 35% during the same period, showing that the bank entered the third quarter with substantial momentum.
The markets division benefits when clients actively trade or adjust portfolios. Volatility can encourage companies, investors and institutions to hedge risks, reposition assets or take advantage of changes in interest rates, currencies, commodities and equity prices. That activity generates revenue for banks even when markets are unsettled.
JPMorgan’s forecast covers both investment banking and markets revenue, suggesting that strength is not concentrated in one product line. Fixed income, currencies and commodities businesses and equity trading are expected to contribute to the improvement.
The contrast with Bank of America shows that large banks are not experiencing identical conditions. Bank of America said its third-quarter revenue would be roughly flat, with equity trading stronger but fixed-income activity weaker. The difference may reflect variations in client mix, market share, risk appetite and business composition.
For investors, that divergence makes quarterly bank results more difficult to interpret. A weak forecast from one institution does not necessarily mean the entire sector is slowing. At the same time, one optimistic outlook does not guarantee that all banks will deliver similar growth.
JPMorgan’s scale gives it several advantages. It has a large corporate client base, a broad international network and major businesses in advisory, underwriting, trading, commercial banking and asset management. Those activities can support one another when clients move between financing, hedging and strategic transactions.
The bank’s corporate relationships may also be helping it capture a larger share of the renewed deal flow. Companies often prefer advisers that can provide multiple services, including M&A advice, debt financing, equity issuance, currency hedging and cash management. A large platform can therefore turn one transaction into a wider relationship.
However, the investment-banking recovery remains uneven across the industry. Data cited by Jefferies showed that proxy investment-banking revenue for eight major global banks had declined during the third quarter to date. The decline was concentrated in advisory, debt capital markets and lending, while JPMorgan and Goldman Sachs held up better than some competitors.
That broader weakness explains why JPMorgan’s outlook matters. If the bank produces strong results while competitors remain under pressure, it may gain market share in advisory and trading. It would also reinforce the view that leading institutions with stronger client relationships are capturing a disproportionate share of available business.
The banking environment is also being shaped by interest rates and bond-market volatility. Changes in central-bank policy influence financing costs, trading conditions and the willingness of companies to pursue acquisitions. Higher borrowing costs can delay deals, while market movements can increase demand for hedging and trading services.
The Federal Reserve’s expected policy decision has added another layer of uncertainty. Markets are preparing for what could be the central bank’s first rate increase since 2023, while oil prices and Treasury yields remain elevated. Those conditions can create both obstacles and opportunities for banks.
For investment bankers, a strong pipeline is not enough by itself. Transactions must be completed, financed and accepted by shareholders. Deals can still be delayed by valuation disagreements, regulatory scrutiny, financing costs or sudden changes in market sentiment.
Petno’s comments indicate that JPMorgan believes current activity is sufficiently broad to withstand those risks. The bank’s pipeline includes M&A and market activity across several areas, reducing reliance on one sector or transaction type.
Trading revenue can also be volatile. A quarter may begin strongly and then weaken if markets become unusually calm, liquidity falls or clients reduce risk. Conversely, sharp price movements can support revenue when clients need to hedge or rebalance.
JPMorgan’s expectation of mid-to-high teens growth therefore represents a forecast, not a final result. The bank will still need to manage market risk, credit exposure and operating costs while converting client activity into sustainable revenue.
The outlook nonetheless sends a positive signal to the banking industry. After a period of cautious dealmaking and uneven capital-markets activity, major corporate clients appear more willing to take strategic action. That can support investment banking fees, trading volumes and demand for financing services.
The forecast also highlights the importance of scale in global banking. Large institutions can benefit from diversified revenue streams, broad client relationships and the ability to provide services across several markets. Smaller banks may struggle more when deal activity is concentrated among the strongest advisers.
For JPMorgan, the immediate challenge is to maintain momentum through the remainder of the year. Strong third-quarter revenue would support the bank’s reputation as a leading global investment bank and could reassure investors who remain concerned about rising costs, economic uncertainty and regulatory pressure.
The bank’s performance will also be watched for signs of whether the broader corporate deal cycle is returning. If M&A activity remains strong, other banks may improve their outlooks. If it fades, JPMorgan’s performance could appear more company-specific than sector-wide.
For now, JPMorgan is presenting a confident picture. Investment-banking fees and markets revenue are expected to grow strongly, deal activity is broad-based and corporate decision-making appears more active. The contrast with Bank of America shows that the recovery is uneven, but JPMorgan’s forecast suggests Wall Street’s most profitable businesses are still capable of delivering substantial growth.
The third-quarter results will provide the final test. Until then, JPMorgan’s message is that the investment-banking market is improving, trading activity remains healthy and the bank is positioned to benefit from stronger corporate confidence.
