The war and the Fed's rate hike helped Goldman Sachs profit from stock trading

Goldman Sachs reported a rise in third-quarter profits on Tuesday: M&A and IPO activity remained steady, while market volatility stemming from the conflict in the Middle East and the Fed’s rate hike boosted the bank’s equity trading revenue, Reuters notes. As a result, the quarterly results of the bank’s equity trading division significantly exceeded expectations, which helped Goldman Sachs offset the decline in fixed-income trading seen across Wall Street, the Financial Times noted.

Goldman Sachs shares rose more than 4% in premarket trading on October 13.

The U.S. stock market was in turmoil throughout the quarter due to the Fed’s September interest rate hike, rising oil prices linked to the ongoing war in the Middle East, and a sell-off of chipmakers’ stocks. Investors were actively rebalancing their portfolios, which generated additional revenue for the banks’ trading divisions, according to Reuters. For example, Goldman Sachs’ revenue from equity trading rose 72% year-over-year in the past quarter, to $6.44 billion. Although this figure fell short of the all-time high of $7.42 billion reached in the second quarter, it still exceeded analysts’ expectations, according to Bloomberg.

At the same time, the bank’s revenue from bond, foreign exchange, and commodity trading totaled $3.47 billion in the quarter that ended on September 30—down 1% from a year earlier and significantly below expectations.

The strong performance of the bank’s equity traders enabled Goldman Sachs to increase its total net revenue for the past reporting period to $18.68 billion ( a 23% increase compared to the third quarter of 2025) and its net income to $5.29 billion, or $17.01 per share, which is nearly 30% higher than the same figure from the previous year.

In addition, during the quarter, Goldman completed two major acquisitions to expand its asset management division, which oversees more than $4 trillion, Bloomberg notes. Specifically, the bank acquired the exchange-traded fund (ETF) provider NEOS Investments for $2.25 billion and the commercial real estate investor LCN Capital Partners for up to $410 million.

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