Big banks are starting to gain momentum in the stock market, with analysts suggesting they are the best investment for the second half of 2025. Major banks like Goldman Sachs, Bank of America, and Morgan Stanley are showing strong investment banking results and positive loan growth.

Stocks of Goldman Sachs and JPMorgan are up 22% and 19% year-to-date, outperforming the S&P 500. This marks a significant shift from earlier in the year when Wall Street was bracing for sluggish growth. Bank executives are now more optimistic about the future.

Big banks are pulling ahead of regional players due to their scale, diversification, and ability to benefit from improving capital markets activity. Regulatory tailwinds could develop under the Trump administration, potentially leading to lower capital requirements and more aggressive lending by big banks.

Firms involved in equity and debt underwriting, advisory services, and trading are in a favorable position. Strong investment banking results in Q2 from Goldman Sachs, JPMorgan, and Morgan Stanley indicate a resurgence in deal activity. Analysts believe there is a long runway ahead for big banks to benefit from increased M&A activity.

Read more at Yahoo Finance: Big banks are back. Here’s why.