Wall Street enters the week of April 13 carrying the weight of a fragile geopolitical truce, a divided Federal Reserve, and an equity market still trading near correction territory from its March lows. The first-quarter earnings reports from the country’s largest banks will determine whether the ceasefire-fueled rally that sent the Dow up 1,325 points on Wednesday marks a genuine turning point — or a brief exhale before the next shock.
Goldman Sachs will kick off earnings season for banks on Monday, April 13. JPMorgan Chase, the largest U.S. lender, will report on Tuesday, April 14, along with Wells Fargo and Citigroup. Bank of America and Morgan Stanley will report on Wednesday, April 15. The banks will report results for the three months ending March 31, during which global markets swung as investors grappled with uncertainty tied to wars in the Middle East and Ukraine, volatile oil prices, and broader geopolitical risks.
Financial stocks comprise roughly 13% of the S&P 500. What these institutions say about loan growth, deal pipelines, credit quality, and the consumer will move markets — and may carry more signal for the broader economy than anything the Fed has said since March.
The Business Model Is Shifting in Real Time
The macro backdrop entering Q1 was already complicated before the conflict erupted. The Fed held rates steady at 3.50%–3.75% through its March 17–18 meeting, marking two consecutive holds after a series of cuts at the end of 2025. That environment brought net interest income — the spread between what banks earn on loans and pay on deposits — to a relative plateau. Banks can no longer rely on rapidly rising rates to pad margins automatically.
After years of relying on Net Interest Income fueled by rising rates, the narrative for 2026 has pivoted sharply toward the return of the fee-machine: investment banking. For the first time since the post-pandemic boom, major banks are projecting double-digit growth in advisory and underwriting fees. After two years of subdued activity, a combination of corporate cash reserves and the need for strategic consolidation in artificial intelligence and energy sectors has triggered a resurgence in M&A. Advisory fees are projected to grow by mid-to-high teens in Q1.
Jefferies analysts noted global M&A proxy fees of $11.3 billion in the first quarter, led by Goldman Sachs. Goldman Sachs CEO David Solomon said in March that he expects mergers and acquisitions activity to accelerate in 2026 despite the disruption caused by the U.S.-Israeli war on Iran.
The question for investors is whether that deal-making momentum — visible in proxy fees and advisory pipelines — actually translated into booked revenue before the March oil shock complicated everything.
What Each Bank Needs to Prove
Goldman Sachs is the most leverage-pure play on investment banking recovery. Analysts expect an EPS range of $15.62 to $15.94, a significant leap from previous years, as the bank’s Equity Capital Markets desk benefits from a high-profile IPO pipeline that includes long-awaited tech giants. Goldman is positioned to capture a disproportionate share of the fee resurgence, having divested its consumer-facing credit card partnerships and pivoted back to its asset-light, advisory-heavy roots.
JPMorgan Chase carries the broadest institutional significance. JPMorgan’s Corporate and Investment Bank division is expected to report mid-to-high teens growth in fees, a rebound fueled by a clearing backlog of M&A and IPO deals that were shelved during the late-2025 volatility. But the real read will come from CEO Jamie Dimon’s commentary. Just days before earnings, Dimon used his annual shareholder letter to warn that the war in Iran risks triggering another round of persistent inflation and higher interest rates that could tip the U.S. economy into recession and reshape the global economic order. He described inflation as the potential “skunk at the party” this year, cautioning that turmoil in oil and commodity markets could ripple through the economy, affecting everything from gasoline prices to manufacturing costs. Markets will be parsing whether that tone softens after Tuesday’s ceasefire announcement — or whether Dimon reiterates the caution regardless.
Citigroup is the transformation play of the quarter. Under CEO Jane Fraser, the bank has spent two years restructuring away from legacy complexity toward a leaner, more capital-efficient model. Wells Fargo analyst Mike Mayo, who named Citi as a top pick, expects the bank to report $1.90 a share versus consensus estimates of $1.84, estimating 9% year-over-year growth in trading largely because volatility and estimated end-user hedging needs remained elevated through March.
Wells Fargo enters Q1 with a different story. Having recently exited its government-mandated asset cap — a legacy of its 2016 fake-accounts scandal — the bank is now positioned to grow more aggressively in commercial lending and capital markets. The question is whether a quarter of elevated oil prices and geopolitical uncertainty weighed on commercial loan demand in ways that dull the structural reopening narrative.
Trading Revenue: The Wildcard That Could Swing All Four
“We expect trading volumes to benefit from recent geopolitical risk, while investment banking, mortgage, and wealth are likely softer until the conflict is resolved,” said David George, a banking analyst at Baird, in a note. That framing captures the Q1 paradox precisely. The oil shock that threatened the macro environment simultaneously drove commodity volatility and elevated client hedging needs — creating a potential windfall for banks with large fixed income, currencies, and commodities (FICC) desks.
Increased trading volumes in commodities and currencies sparked by the oil crisis are expected to contribute to Bank of America’s 16th consecutive quarter of year-over-year trading revenue growth. If that pattern holds across JPMorgan, Goldman, and Citigroup as well, it would represent one of the more counterintuitive earnings tailwinds in recent memory — a geopolitical crisis that hurt the economy while boosting bank trading desks.
The Guidance Call Matters More Than the Print
With the Iran ceasefire announced on Tuesday evening — just 72 hours before Goldman reports — the banks will be navigating an unusual communications challenge. Q1 results will reflect a quarter of war-era conditions; Q2 guidance will be shaped by a peace process that may or may not hold.
Wells Fargo analyst Mike Mayo said the year-to-date underperformance of big bank stocks should reverse on upcoming strong Q1 earnings, once-in-a-generation deregulation, and a favorable capital markets backdrop. That deregulatory argument is real — Basel III capital rule changes have shifted in a direction favorable to large U.S. banks, and with Powell’s term expiring in May, a new Fed chair appointed by the Trump administration may take an even lighter regulatory touch.
Goldman Sachs projects that S&P 500 earnings will grow by 12% year-over-year in 2026 and that the index will reach 7,600 by year-end. April bank earnings are viewed by Goldman analysts as the definitive litmus test for that thesis. A “beat-and-raise” performance from the financial sector could be the catalyst needed to transition the market from a fear-based retreat back into a calculated search for quality growth.
For investors, the calculus is straightforward. If the banks beat on fee revenue, confirm deal pipelines are rebuilding, and offer Q2 guidance that acknowledges the ceasefire without treating it as a permanent resolution, the financial sector rally likely has legs. If Dimon or Solomon signal caution about second-half visibility — pointing to residual energy volatility or credit normalization concerns — the week’s gains will face a test.
The starting gun fires Monday morning.
Disclaimer: This article is intended for informational and analytical purposes only and does not constitute investment advice or a recommendation to buy or sell any securities. All data and estimates referenced are sourced from publicly available reports and analyst commentary. Investors should consult a qualified financial advisor before making investment decisions. Past performance is not indicative of future results.
