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Donald Trump’s return to the White House could fuel a blockbuster 2025 on Wall Street, but concerns remain over inflationary policies and global tensions, major US banks said as they opened their bumper quarterly results. income.

Top executives from some of Wall Street’s biggest banks on Wednesday offered upbeat views for this year, particularly in their investment banking businesses, which have increased profits in recent months.

The cautiously optimistic sentiment underscores how many U.S. executives hope the president-elect’s promises to boost growth and cut regulations will be a boon to their businesses even as they worry about in his sometimes poor policy making.

The chief executive of Goldman Sachs David Solomon on Wednesday said: “There is a significant shift in CEO confidence, especially after the US election results. In addition, there is . . . a general increased appetite for dealmaking supported by a evolving regulatory backdrop.”

“The combination of these conditions should encourage more activity in 2025,” he added.

BNY chief executive Robin Vince added: “The incoming Trump administration has made it clear that they are pro-growth . . . if that pro-growth translates into activity, which we obviously hope it will, we think that’s a great final backdrop.

The momentum runs the gamut from mergers and acquisitions to debt issuance and plans to float more companies on the public market, bankers said.

JPMorgan’s chief financial officer Jeremy Barnum said the US is in a “time of animal spirits . . . We’re pleased to see greater optimism in c-suites nationally and around the world in some pockets.

The banks’ expectations for a strong 2025 came after they reported significant increases in profits for the last quarter of last year: JPMorgan’s net income rose 50 percent to $14bn, while Goldman doubled to $4.1bn. Citi made a profit of $2.9bn from a loss of $1.8bn in the last quarter of 2023.

Shares of Citi jumped 7 percent after the release of its results, with Goldman up 5 percent and JPMorgan gained more than 1 percent.

Banks benefited from a sharp increase in trading in equities before and after Trump’s November election victory. His win sent stocks soaring, though the markets gave up a significant portion of the gains.

Investment banking also outperform companies that tap into market conditions to raise funds by selling stocks and bonds. A rebound in M&A activity is also encouraging.

Even Wells Fargo, which makes most of its revenues from consumer and corporate businesses, reported a big boost from investment banking.

Significant payments to replenish the federal deposit insurance fund that dragged down earnings in the last quarter of 2023 also flattered the year-over-year comparison of total net income.

Despite the strong showing, leading financiers also warned that the momentum could be broken by a geopolitical crisis or an economic shock caused by the rapid change in government policy under Trump, which is often which unexpected paths in his first term of office from 2017 to 2021.

“Geopolitical conditions remain the most dangerous and complex since World War II,” warned JPMorgan CEO Jamie Dimon.

Trump has not only promised mass deportations of illegal immigrants and huge tariffs, but is also thinking about taking over Greenland and the Panama Canal, among other things.

“It’s a complicated world and I think we all have to be prepared for the unexpected,” Solomon said. “There is uncertainty when you look broadly at immigration policy, trade policy, tax policy, energy policy . . . there are different outcomes.”

A return to high inflation could also disrupt markets, put pressure on corporate profits and weaken dealmaking, they warned.

BlackRock CEO Larry Fink told CNBC: “I think the economy is in very good shape. That said, is it in good shape? Are we going to start seeing high inflationary pressure? We’ll see. ”

The world’s largest money manager reported that it attracted record new money in the second half of 2024.

Additional reporting by Zehra Munir in New York and Harriet Agnew in London