News
The day at a glance · 3 min read
Mood · Risk-Off
-45
Sentiment, −100 to +100
Fed Funds Rate
3.75%-4%+0.25%
Federal Reserve Policy Impact
Goldman Revenue Target
$70B
Major Bank Strategy & Earnings
GS PE Fund IX Raised
$9.6B
Major Bank Strategy & Earnings
Key driverFederal Reserve delivered first rate hike in over three years to 3.75%-4% target range, with Chair signaling inflation risks remain elevated
Daily briefFinancials· Money365.Market AI ·

Banks Fall on Fed Hike; Goldman Targets $70B Revenue

Regional banks retreat as Fed raises rates to 3.75%-4% range; Goldman Sachs outlines growth strategy while JPMorgan CEO voices inflation concerns

Federal Reserve Policy Impact

Bearish
JPMBLKFITBCFGWDPNCWSBCPNFPZIONRFMTB
The Federal Reserve delivered its first rate hike in more than three years, raising the overnight funds rate by a quarter point to a 3.75%-4% target range and signaling another hike could come this year, according to CNBC. Regional bank stocks including KeyCorp, Fifth Third Bancorp ($FITB), Citizens Financial Group ($CFG), Walker & Dunlop ($WD), and PNC Financial Services Group ($PNC) fell in the afternoon session after the Fed announcement, with stocks initially absorbing the widely expected move before selling off during the press conference. Additional regional banks including WesBanco ($WSBC), Pinnacle Financial Partners ($PNFP), Zions Bancorporation ($ZION), Regions Financial ($RF), and M&T Bank ($MTB) also declined after Chair Kevin Warsh stressed that inflation is too high and risks remain elevated.
JPMorgan Chase ($JPM) CEO Jamie Dimon stated that it is not clear to him that inflation has been defeated, reflecting ongoing concerns about elevated price pressures. The Federal Reserve's higher-for-longer stance has put BlackRock ($BLK) and cash ETFs in focus, with short-duration investment-grade bond and cash-equivalent ETFs now serving as a battleground as investors weigh yield against stability and inflation risk.

Major Bank Strategy & Earnings

Neutral

Morgan Stanley Close

$202.42-1.87%

BAC 3-Year Gain

117.9%
GSJPMBACMS
Goldman Sachs ($GS) chairman and chief executive officer David Solomon stated the firm is focused on expanding earnings, improving operating efficiency and building a more durable revenue base as it pursues growth across Global Banking & Markets and Asset & Wealth Management, with the bank eyeing a $70B revenue base as asset and wealth management growth accelerates.
Goldman Sachs Asset Management has closed West Street Capital Partners IX, which raised $9.6 billion of commitments, with the firm's global co-head of private equity Michael Bruun indicating the latest flagship buyout fund was sized to remain within reach of strategic buyers by targeting companies with enterprise values of $500 million to $3 billion.
JPMorgan Chase ($JPM) Co President Doug Petno flagged mid to high teens growth in third quarter investment banking fees and markets revenue at a recent Barclays conference, with the outlook paired with broad based strength across products and regions helping refocus attention on the stock as investors weighed the contrast with more cautious tones from several peers.
Bank of America ($BAC) published research on utility bills rising faster than inflation over the summer, finding that summer heat, modernization of the US power grid, and the data center build-out contribute to higher costs. The bank has delivered a multiyear run with the stock gaining approximately 117.9% over the past three years, though recent headlines on interest rates, digital assets, and fee income have raised questions about valuation.
Morgan Stanley ($MS) reached $202.42 at the closing of the latest trading day, reflecting a -1.87% change compared to its last close. The firm doubled down on its bearish call on Peloton in a note, addressing the main pushback from investors who see paths to upside after its recent downgrade.

Payments & Digital Assets

Neutral

Visa Take Rate

<0.3%

Arc First-Day Volume

$410.8M

Bitcoin ETF Outflows

$450.4M
VMABLK
An analysis examined what it would take to move Visa's ($V) take rate, noting that the rate does not even reach 0.3%, characterizing this as awfully modest. Circle's Arc mainnet counts BlackRock ($BLK), Mastercard ($MA), and Visa ($V) among its founding validator cohort, though Circle stock slipped despite the announcement.
Meme coin launchpads captured 82% of Arc's $410.8 million first-day DEX volume as Circle's chain went live. US spot Bitcoin ETFs lost $450.4 million as the CLARITY Act stalled in the Senate, adding regulatory uncertainty to an already weak crypto market.

Asset Management & Portfolio Positioning

Neutral

Berkshire AI Exposure

30.6%
AXP
Berkshire Hathaway is known for holding stable, boring stocks, but it still has significant exposure to AI companies, with 30.6% of its portfolio in two AI stocks, one of which is American Express ($AXP).

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