U.S. banks' dismal first quarter may spell trouble for 2016
It is only April, but some on Wall Street are already predicting a rotten 2016 for U.S. banks.
Analysts say it has been the worst start to the year since the financial crisis in 2007-2008 and expect poor first-quarter results when reporting begins this week.
Concerns about economic growth in China, the impact of persistently low oil prices on the energy sector, and near-zero interest rates are weighing on capital markets activity as well as loan growth.
Analysts forecast a 20 percent decline on average in earnings from the six biggest U.S. banks, according to Thomson Reuters I/B/E/S data. Some banks, including Goldman Sachs Group Inc (GS.N), are expected to report the worst results in over ten years.
This spells trouble for the financial sector more broadly, since banks typically generate at least a third of their annual revenue during the first three months of the year.
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