Evercore sees softer third quarter guides for banks

Investing.com -- Evercore issued its August 2026 Capital Markets Monthly report, indicating that investment banking volumes declined 6% year-over-year in July, with weaker debt capital markets activity offsetting gains in equity capital markets and mergers and acquisitions.

Debt capital markets and syndicated lending fell 18%, while equity capital markets surged 119% and M&A activity rose 11%. Trading key performance indicators showed improvement after a slower July, with most fixed income, currencies and commodities metrics tracking in the low to high double digits year-over-year quarter-to-date.

Equities activity showed mixed results. CBOE volumes fell 4% year-over-year, while retail and option activity climbed 43% and 14% respectively. Margin balances remained stable despite some deleveraging related to artificial intelligence in July, with average quarter-to-date balances up 32% year-over-year.

Evercore stated that quarter-to-date key performance indicators are tracking behind expectations, suggesting the Street may have set third quarter earnings per share estimates too high. The firm anticipates investment banking and trading guidance to come in below consensus, while wealth and trust fee commentary should align with or fall slightly below expectations.

The firm noted that investors appear aware of the slower quarter, as shares and multiples have adjusted against weaker data and higher rates and oil prices. Fixed income, currencies and commodities trading volume growth held up year-over-year, with foreign exchange up 17%, commodities up 17%, credit up 10%, and rates up 2%.

Equity and fixed income markets rose 3% and remained flat month-over-month respectively. Average H.8 loan and deposit balances both increased 6% year-over-year.

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