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Major Wall Street banks saw a boost in investment-banking fees in the third quarter, driven by increased deal activity and rising debt issuance. The anticipation of rate cuts by central banks worldwide has fueled optimism among bankers, leading to a healthy pipeline of new deals.

Goldman Sachs reported a 20% increase in investment banking fees, with a strong performance in leveraged finance, investment-grade activity, and equity underwriting. Bank of America also experienced an 18% jump in investment banking fees, citing a rebound in activity as client confidence improved.

Citigroup continued its trend of strong performance in investment banking, with revenue up 31% driven by investment-grade debt issuance. JPMorgan exceeded expectations with a 31% surge in investment-banking fees, driven by robust equities trading revenue.

Wells Fargo also saw positive results, with a 12% increase in non-interest income attributed to higher investment banking fees and strong trading revenue. Despite the positive outlook, dealmakers are closely monitoring the impact of the U.S. elections and geopolitical uncertainties on the investment landscape.

M&A activity has been on the rise, with global deals totaling $909 billion in the third quarter, up 22% from the same period last year. Notable deals included Mars’ acquisition of Kellanova and Blackstone’s buyout of AirTrunk. U.S. investment-grade bond issuance has also shown significant growth.

As the Fed easing cycle begins and Interest rates decline, experts recommend investing in banks with diversified income sources. Overall, the outlook for the investment banking sector remains positive, supported by favorable market conditions and strong deal pipeline.

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