Goldman Sachs earnings preview

What happened: Goldman Sachs reported record-breaking quarterly results, with net revenues and EPS reaching the second-highest levels in the firm's history. This was driven by robust performance in Global Banking & Markets, particularly in FICC and equities, despite a dynamic macro environment. Earnings per share came in at $17.55, surpassing the expected $16.47. The strong performance was attributed to a resurgence in deal activity and volatile markets.

Market impact: The banking sector was positively affected, with other major players like JPMorgan and Bank of America set to report earnings soon. However, Goldman Sachs' stock initially dropped about 4% despite the beat, due to concerns over credit costs and mixed performance across divisions. This suggests investors are closely scrutinizing banks' credit portfolios and may react similarly to other banks' earnings.

What to watch next: On April 20, JPMorgan Chase and Wells Fargo will report earnings, followed by Bank of America on April 24. These reports will provide further insight into the banking sector's performance and credit quality. Additionally, the Federal Reserve's interest rate decision on May 3 will influence banks' net interest margins and overall profitability.