Four of five big Wall Street banks reported outstanding Q2 results. JPMorgan Chase, Bank of America, Citigroup and Goldman Sachs posted aggregate equity and debt trading revenue of $38bn, up more than a third year-over-year and 60% versus two years ago. Investment banking fees hit $10bn. Morgan Stanley reports today.

The stocks have surged. Goldman Sachs, Morgan Stanley and Citigroup have more than doubled in 24 months. Lex column argues this bonanza is a side-effect of the AI boom driving markets and capital-raising. The banks are now essentially straight AI plays — a reversal would hit trading, investment banking, credit quality, wealth management assets and net interest margins.

June CPI cooled to 3.5 per cent annually from 4.2%, with month-over-month turning negative. Core CPI also fell. Yet markets still price nearly two quarter-point hikes by April 2025. Chris Waller set a line at core PCE persistently above 3%; Goldman Sachs forecasts yesterday's print brings core PCE to 3.3%. One report won't remove hike expectations.