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What’s happening: Shares of The Goldman Sachs Group gained on Monday, after the company reported results for its second quarter.
What happened: The US financial services giant reported stronger-than-expected sales and earnings for the latest quarter.
Goldman Sachs’ stock, which had spiked to a record high on Friday, extended gains on Monday.
How were the results: The New York-based company reported a low double-digit increase in sales for the second quarter.
Why it matters: Goldman Sachs said its profits more than doubled in the second quarter, amid strength in underwriting and fixed-income trading. The company’s net income was $3.04 billion during the three months through June 30.
Global Banking & Markets revenues surged 14% year-over-year to $8.18 billion, as investment banking fees rose 21% year-over-year to $1.73 billion. Fees earned from advising on mergers and acquisitions climbed 7%.
On Friday, JPMorgan reported a 46% surge in its investment banking revenues, while Citibank announced 60% growth.
Asset & Wealth Management revenues grew by 27% to $3.88 billion. Net revenues in Fixed Income, Currency, and Commodities gained 17% year-over-year to $3.18 billion. Consumer banking revenue rose 4%, while transaction-banking fees fell 15% year-over-year.
Goldman Sachs reported provision for credit losses of $282 million in the second quarter, versus $615 million for the year-ago quarter.
On July 12, the company had raised its quarterly dividend from $2.75 per share to $3.00 per share.
How shares responded: Goldman Sachs’ shares rose 2.6% to close at $492.23 on Monday following the release of quarterly results. The stock has added around 29% over the past six months.
What to watch: Investors will continue monitoring interest rates and inflation levels, which are expected to significantly impact the bank’s results ahead.
Context: The CAD/USD forex pair moved lower on Monday, as investors assessed the latest economic data.
Details: Data released on Monday showed wholesale sales in Canada declining by 0.8% in May, versus market expectations of 2% growth. This followed the 2.4% gain recorded in the prior month.
Manufacturing sales rose 0.4% in May, versus a preliminary reading of 0.3% and following the previous month’s 1.4% gain. Car registrations in Canada rose to 184,703 units in May, the highest level since August 2019, compared to 175,066 units a month ago.
Weakness in the price of crude oil, one of Canada’s major exports, exerted pressure on the loonie. WTI crude oil for August delivery declined 30 cents to settle at $81.91 per barrel on Monday.
Some strength in the US dollar also weighed on the CAD/USD forex pair. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained around 0.1% to 104.19 on Monday.
The CAD/USD fell around 0.3% to 1.3683 on Monday. The S&P/TSX Composite Index gained 0.34% to close at 22,751.68.
What to watch: Investors await the release of economic data on housing starts and inflation rate from Canada today. Housing starts in Canada, which rose by 10% to 264,506 units in May, are expected to decline to 260,000 units in June. Analysts expect the annual inflation rate in Canada to remain unchanged from the prior month at 2.9% in June.
Other Markets: European indices closed lower on Monday, with the FTSE 100, DAX 40, CAC 40 and STOXX Europe 600 Index down by 0.85%, 0.84%, 1.19% and 1.02%, respectively.
Russia’s Defence Ministry said it had taken control of a village in Ukraine’s eastern Donetsk region. The news sent the safe-haven US dollar index higher in forex trading this morning.
Colombia’s manufacturing production contracted by 3.6% year-over-year in May, compared to a 4.1% gain a month ago, exerting pressure on the COP/USD forex pair.
South Korea’s import prices climbed 9.7% year-over-year in June, compared to a 4.7% gain in the prior month, which sent the KRW/USD pair lower in forex trading this morning.
Israel’s annual inflation rate accelerated to 2.9% in June, from 2.8% a month ago. The figure being higher than market expectations of 2.8% exerted pressure on the ILS/USD forex pair.
Sri Lanka’s manufacturing PMI declined to 56.6 in June, from 58.2 in the prior month, sending the LKR/USD pair lower in forex trading this morning.
Saudi Arabia’s inflation rate and wholesale price inflation, Italy’s inflation rate and balance of trade, Eurozone’s balance of trade and ZEW indicator of economic sentiment, Germany’s ZEW economic sentiment index and ZEW current conditions subindex, US retail sales, export prices, import prices, Redbook index, business inventories, NAHB/Wells Fargo housing market index and API’s crude oil inventories, France’s current account, as well as Turkey’s central government budget balance.
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