Stocks soar as America's biggest banks are booming
New York (CNN Business) Several of America's largest financial firms reported strong earnings and revenue Thursday thanks to solid demand for loans, better credit quality and a boom in mergers and initial public offerings.
Shares of BofA rose nearly 4% in midday trading while Morgan Stanley was up about 2%.
The somewhat muted reaction from some bank investors might be due to the fact that their good news was already priced into the shares.
Bank stocks have already surged this year on hopes of an economic rebound and rising long-term bond yields, which help to boost lending profits.
Investors also cheered the continued drop in jobless claims filings, which fell to a new Covid-era low of 293,000.
Top banking executives sounded upbeat about the future, too.
Credit quality has remained strong, and, as a result, banks are now seeing a boost to profits.
Top Wall Street firms are also benefiting from the breakneck pace of dealmaking in Corporate America.
Companies have gotten the urge to merge and many top unicorn startups have gone public this year.
Morgan Stanley reported a 67% increase in investment banking revenue, numbers that CEO James Gorman dubbed a "standout performance" in the earnings release.
Morgan Stanley also got a boost from acquisitions of online broker E-Trade and asset manager Eaton Vance.
JPMorgan Chase JPM The good news for big banks comes one day afterCEO Jamie Dimon gave an upbeat outlook about the US economy after the bank also reported earnings that topped forecasts.