Goldman Sachs stock falls after CEO warns of softer trading

Investing.com -- Goldman Sachs Group Inc. (NYSE: GS) shares fell 4% Wednesday after Chief Executive Officer David Solomon warned of softer fixed-income trading and higher expenses during the third quarter.

Speaking at a Barclays conference, Solomon said the bank’s fixed-income, currencies and commodities (FICC) business has been weaker on a relative basis during the quarter, though he noted that overall activity levels have been very high. Equity trading has remained "very strong," he added.

The CEO said costs are expected to be higher given elevated client activity levels during the period. Goldman has also accelerated some technology investments, which will contribute to increased expenses.

The comments provided investors with an early glimpse into the bank’s third-quarter performance ahead of its earnings report. Solomon’s remarks about softer FICC trading contrasted with the strength in equity markets during the quarter, suggesting uneven performance across Goldman’s trading divisions.

Goldman’s trading business has been a key driver of revenue in recent quarters, making Solomon’s cautionary tone about fixed-income performance notable for investors assessing the bank’s near-term outlook.

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