CoinWorld reported that as investors speculate that the Federal Reserve may cut interest rates next month, the U.S. bank stock index is expected to achieve its first record closing since January 2022. The KBW Bank Index, which tracks 24 of the largest banks in the U.S., rose by as much as 3%, poised to set a historical closing record. This would end a sluggish period of over 900 trading days, the longest since the financial crisis when the index failed to surpass its peak for more than 3,500 trading days. As Powell cautiously opens the door for a rate cut in September, bank stocks also joined the broader market rebound on Friday. Overall, thanks to volatility in the stock, bond, and foreign exchange markets, major Wall Street banks showed robust performance in the second quarter. All banks that underwent the Federal Reserve's annual stress tests passed easily, allowing them to raise dividends beyond market expectations. This year's rise in bank stocks has also been driven by market expectations that a more lenient regulatory environment under the Trump administration will stimulate corporate merger and acquisition activities, thus boosting investment banking revenue.
