| Donald Trump’s trade war usually takes away, but sometimes it gives, too. This week America’s biggest banks reported second-quarter earnings, and the numbers revealed that the market chaos sparked by the US president’s tariff announcements led to a bonanza of trading revenue. As retail and professional investors alike tried to make sense of it all, stocks, bonds and currencies changed hands at a torrid pace — and the banks in the middle made a lot of money. At Goldman Sachs Group Inc., stock traders brought in $4.3 billion in net revenue, up 36% from a year earlier and a Wall Street record for a single quarter. And for the first half of the year, trading revenue at the five biggest US lenders jumped $10 billion from last year to a record level, with tariffs and tax policy driving a surge of activity, Bloomberg’s Katherine Doherty reported. “Trading got a real tailwind because of all the volatility that we’ve seen,” David Dietze, chief investment strategist at Dietze Wealth Management Group, said on BNN Bloomberg Television after Goldman put out its report on Wednesday. “Will there be tariffs? Will there be interest rate cuts? Will Jerome Powell state his position?” Canadian banks report on a different schedule, two months ahead of regular calendar quarters (because, reasons). Their second-quarter numbers, which included the month of April, confirmed that they also benefited from volatile markets after Trump temporarily liberated investors from higher equity prices. National Bank of Canada notched a record at its capital-markets unit on trading revenue that was fueled by what one executive called “a couple of the most profitable days in the history of the franchise.” And now, as Canadian lenders get set to close the books on the fiscal third quarter at the end of the month, they’re poised to keep profiting from the turbulence. “US bank second-quarter results point to a stronger quarter in capital markets for Canada’s banks with large US operations,” TD Cowen analyst Mario Mendonca wrote in a report this week. That would include Royal Bank of Canada, where almost half of the firm’s capital-markets revenue now comes from the US. Markets are pricing this in. The S&P/TSX Commercial Banks benchmark has produced a nearly 20% return in three months, including dividends. It’s not just trading divisions that stand to gain, according to Brian Belski, chief investment strategist at BMO Capital Markets, who’s bullish on Canadian banks. Their wealth-management arms also can benefit from rocky markets, he pointed out this week. The downside is that tariff uncertainty has sapped business confidence, putting deals and major decisions on hold — which has meant leaner times for some investment banks. But there are some signs of improving sentiment, particularly in the US. JPMorgan Chase & Co.’s investment bankers eked out a surprise gain in the second quarter, with fees climbing 7%. CEO Jamie Dimon said risks remain, yet dealmaking activity in the quarter “started slow but gained momentum” as the US tax bill was finalized and talk of deregulation took hold.  JPMorgan’s Dimon said dealmaking gained momentum as the second quarter progressed and market sentiment improved. Photographer: Patrick Bolger/Bloomberg Businesses are figuring out how to forge ahead despite the uncertain path for economic policy, according to Tim Haney, CEO of the law firm Dentons Canada. “We’re seeing from clients that that’s the new norm, and they want to lean in and transact and do things in that environment,” he said in an interview. Kate Barton, Dentons’ global CEO, who was in Toronto for meetings this week, said the firm’s clients have been doing due diligence. There are plenty of deals to be considered as private equity firms look for exits from businesses they didn’t expect to still be holding by now, she said. “There’s a lot of shopping going on, but not a lot of buying,” she said. “At some point it’s going to pop.” For investment bankers, who don’t get paid until deals get done, that can’t happen soon enough. | 
