Call of the Day: Goldman Sachs
Bank of America reiterates their buy rating on Goldman Sachs, it's our Call of the Day. The Investment Committee debates how to trade the banks.
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USA Today
an hour ago
- USA Today
Goldman Sachs cuts US recession odds to 30% after trade deal progress
Goldman Sachs cuts US recession odds to 30% after trade deal progress Show Caption Hide Caption Top business leaders see recession risk fading CEOs of nearly 280 U.S. companies say the odds of a downturn in the second half of 2025 are shrinking, many shifting to growth expectations. Straight Arrow News Goldman Sachs on Thursday trimmed its U.S. recession probability to 30% from 35% for the next twelve months on easing uncertainty around President Donald Trump's tariff policies after the U.S. and China affirmed a trade deal. Earlier this week, negotiators from Washington and Beijing agreed on a framework covering tariff rates with the deal seeing removal of Chinese export restrictions on rare earth minerals and giving Chinese students access to U.S. universities. Investors breathed a sigh of relief following the deal and easing concerns of an economic recession, after Trump's "Liberation Day" tariffs on April 2 rattled global financial markets. In case you missed it: You won't know when a recession starts: 5 key facts about downturns Goldman said domestic inflation readings so far – while offering only limited evidence – reflected a slightly smaller impact on U.S. consumer prices from tariffs. Data on Wednesday showed consumer prices increased less than expected in May, but is expected to rise in the coming months on the back of Trump's import tariffs. "Broad financial conditions have now eased back to roughly pre-tariff levels... (and) measures of trade policy uncertainty have moderated a bit following steps toward de-escalation," said Goldman, for nudging down its recession forecast. The Wall Street brokerage also boosted its 2025 U.S. GDP growth prediction to 1.25% from its prior forecast of 1% on a quarterly basis. Reporting by Siddarth S in Bengaluru; Editing by Arun Koyyur and Shailesh Kuber
Yahoo
6 hours ago
- Yahoo
Bank of America and US Bank ready to join stablecoin party
If Congress goes all in on crypto, some of America's top banks are ready to follow. At an industry conference in New York this week, top executives at Bank of America, Fifth Third Bancorp and U.S. Bancorp all said they were open to working with stablecoins — cryptocurrencies whose value is tied to more traditional assets — and seemed confident that they'll soon be in safe regulatory territory. "We have to have it. The industry has to have it," BofA's Brian Moynihan, CEO of the country's second-largest bank, said at the conference, which was hosted by Morgan Stanley. "We've not been quite sure how big it will be, but we have to be ready." The backdrop for that bullishness is the most crypto-friendly government the 16-year-old industry has ever seen. As the CEOs spoke, the U.S. Senate moved closer to passing the GENIUS Act — standing for the Guiding and Establishing National Innovation for U.S. Stablecoins Act — a bipartisan bill to establish a clear framework for regulating the products. This new environment marks a stark turnaround from the Joe Biden era, when regulators openly discouraged investing in digital assets and rejected many applications for new crypto products. Former Securities and Exchange Commission Chair Gary Gensler, for example, once called bitcoin "primarily a speculative, volatile asset that's also used for illicit activity." That atmosphere, combined with a lack of crypto legislation during the Biden years, deterred many banks from jumping into the market. But on Wednesday, the Senate voted to end debate on the GENIUS Act, and a final vote is expected next week. Meanwhile, the House is mulling over the STABLE Act — short for the Stablecoin Transparency and Accountability for a Better Ledger Economy Act — which covers similar ground as the Senate measure and also enjoys bipartisan support. The two bills may eventually be reconciled into one. As the political winds have shifted, a number of bank leaders appear to have lost their reservations about crypto. Bank of America has taken part in discussions with several other large banks — including JPMorganChase, Citigroup and Wells Fargo — about the possibility of issuing a joint stablecoin, according to the Wall Street Journal. On Wednesday, Moynihan credited the changing regulatory scene for his bank's evolution. "The problem before was, it wasn't clear we were allowed to do it under the banking regulations, and there was a lot of mystery about that," Moynihan said. "If they get the GENIUS Act or the STABLE Act or anything like that passed … that clarity will allow us to figure out whether there's really a business proposition." Bryan Preston, the chief financial officer of the $213 billion-asset Fifth Third, took a similarly proactive stance, saying stablecoins could be used to make international payments instantaneously, or to move collateral instantly from market to market. "We're always trying to look ahead," Preston said at the conference. "We think that there are some interesting places where stablecoin can really create some efficiencies in the commerce space." Gunjan Kedia, CEO of the $676 billion-asset U.S. Bancorp, pointed to her own bank's experience to underline how much the new regulatory environment has changed the crypto outlook. Four years ago, she noted, U.S. Bancorp introduced a crypto custody product — but in the Biden years, it went nowhere. "The product didn't really take off because the regulatory regime at that point was very uncertain for large institutional investors," Kedia said on Wednesday. "That product is back, and we are very able to provide it." The CEO also said U.S. Bancorp is studying how it could help use stablecoin for payments, but much of that will depend on how the new regulations shape up. "We are watching it, and there's a lot to be sorted out before the role we play solidifies in our mind," Kedia said. And it's not just American banks getting in on the action. The French bank Societe Generale is planning to introduce a U.S. dollar-based stablecoin, called USD CoinVertible, in July. To be sure, not every bank is rushing into the crypto space. John Turner Jr., the CEO of Birmingham, Alabama-based Regions Financial, which has $160 billion of assets, showed a clear reluctance to jump in. "Never say never, but I've not been a great fan of crypto," Turner said Tuesday at the conference. "And so I think we'll be a follower there, for sure, not a leader." But for the most part, bank leaders struck a markedly more assertive tone about digital currencies than they had in the past. In Moynihan's view, embracing stablecoin is a matter of necessity. "At the end of the day, if people use it as a transactional account, we have to be ready to have those transactional deposits stay within our franchise," Moynihan said, "or else you'll see a major migration of deposits outside the industry." —Colin McNamara contributed to this article. Sign in to access your portfolio
Yahoo
6 hours ago
- Yahoo
RBC elevates US investment bankers Chawhan, Monga to unit heads
By David French NEW YORK (Reuters) -RBC Capital Markets has promoted two of its financial services investment bankers to run units advising insurance and specialty finance companies in the U.S., a spokesperson for the bank confirmed on Thursday. Neil Chawhan has been elevated to head of U.S. insurance investment banking, and Saurabh Monga will now co-lead the U.S. specialty finance business of RBC Capital Markets. Both Chawhan and Monga have been managing directors within the investment banking arm of Royal Bank of Canada since 2017, according to their respective LinkedIn profiles. Chawhan's career before RBC was predominantly at Bank of America, where he spent nearly 16 years, with a stint at Stifel's Keefe, Bruyette & Woods before joining the Canadian bank. Prior to RBC, Monga spent nearly 17 years split between Deutsche Bank and Bank of America. Monga's stewardship of the U.S. specialty finance team will be alongside Eric Steifman, the investment bank's co-head of U.S. banks and specialty finance. Sign in to access your portfolio
