JHG - SA Ideas: Goldman Sachs results may explain why capital markets stocks have soared for weeks

Financial market activity over the year has been a boon for Goldman Sachs (GS), as the bank’s strong latest quarterly results show. Its underwriting and asset management divisions thrived as IPOs boomed and markets remained volatile. Those same dynamics may be making capital markets a rare bright spot recently in the otherwise languishing financial sector. Goldman is up 7% over the last month, and the S&P Capital Markets ETF (KCE) is ahead 10.4% over the same time frame. As comparison, the S&P 500 gained 3.4%, and the Financial Sector SPDR ETF (XLF) 0.8%. Asset management is giving an assist to the KCE as well. Goldman's revenue in that area hit $2.8B in Q3, up 75% from year-ago levels. There's also M&A animal spirits, with Morgan Stanley agreeing to buy Eaton Vance (EV) in a $7B deal, and chatter that Waddell & Reed is a buyout target. Indeed, the five largest gainers in the KCE over the last month

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SA Ideas: Goldman Sachs results may explain why capital markets stocks have soared for weeks