Finance, in brief

Brian Moynihan, chief executive of Bank of America, said on Monday that its fees from helping companies raise money and buy each other will fall at least 10% this quarter. [1][2]

He expects those fees at $1.6 billion to $1.8 billion for July to September, down from $2 billion a year earlier. [1] Analysts had expected close to $2 billion. [3]

He said trading revenue, the money the bank makes buying and selling shares and bonds, will be roughly flat on last year's $5.4 billion. [1]

That is a sharp turn from April to June, when the bank's dealmaking fees jumped 50% and its trading revenue 33%. [2]

Moynihan said dealmaking fees across the whole industry are down about 10%, citing Dealogic, a firm that tracks deals. [2] He said his bank would do a bit worse, because it is weaker in the busiest areas. [2][4]

He still called flat trading one of the bank's better third quarters ever. [4]

Bank of America shares closed 5.14% lower on Monday, at $59.47. [5] The S&P 500's index of bank shares was down 2.7% by late afternoon. [1]

Banks that gave no forecast fell too: Goldman Sachs 3.96%, Morgan Stanley 3.64% and Barclays 3.09% at Monday's close. [5]

On Tuesday the fall reached Asia. Sumitomo Mitsui Financial fell 2.7%, Nomura 2.6% and HSBC 2.2%. [6]

Figures from Jefferies, an investment bank, had already shown dealmaking income at eight big global banks down 15% on a year earlier, as of 3 September. [5]

Moynihan said deal pipelines are still full, but warned that higher interest rates could slow companies' demand for financing. [1]

He said American consumers are still spending and borrowers are repaying as well as they have in a long time. [1]

KeyCorp, a US bank speaking at the same Barclays conference, raised its own forecast for dealmaking fees to growth of 4% to 5%. [8]

Why it matters. The next check is the other big banks' own results for July to September, and whether a US rate rise on Wednesday slows companies' borrowing, as Moynihan warned higher rates could. [1]

The interest rate on ten-year US government bonds rose to 5.012% on Monday morning, then closed at 4.96%. [9] Several outlets said it was the first time above 5% since 2023. [10][23] That rate is what investors charge the US government to borrow for ten years. Investors pointed to heavy government borrowing, strong growth, dearer energy and the chance of higher US interest rates. [11] The Capital Spectator, a research site, estimated the rate sat about 0.58 percentage points above its fair value in August. [12]

Why it matters. US mortgages follow this rate, and the average 30-year mortgage reached 6.76% last week, up from about 6% in late February. [10] It also raises what the US government pays on a debt that is now larger than its whole yearly economy. [10]

Dario Amodei, head of the AI company Anthropic, called on Saturday for AI companies to slow down, and Elon Musk and OpenAI's Sam Altman said they agreed. [13] On Monday an index of US chipmaker shares fell 5.9%, with Nvidia, Broadcom and Intel hit hard. [9] The Nasdaq, a share index full of technology firms, closed 0.6% lower. [9] Software firms went the other way: before the market opened, ServiceNow was up about 3%, and Adobe and Workday about 2.5%. [13]

Why it matters. Investors worried that demand for AI services, and for parts like memory chips, could weaken. [9] Michael Burry, an investor known for betting against US housing in 2008, said the warnings were an attempt by big firms to hold back smaller rivals. [13]

China's factory output grew 5.2% in August from a year earlier, faster than July's 4.5% and above the 4.8% economists expected. [14] Retail sales, a measure of what shops sell, grew only 0.4%, below forecasts. [14][16] Investment in things like roads, factories and buildings fell 7.2% in the first eight months, after a 6.7% fall to July. [17] Property investment fell 19.9%. [14] China's statistics office described an imbalance of strong supply and weak demand. [15]

Why it matters. Unemployment in China's cities edged up to 5.3%, and new bank lending came in far below forecasts. [14][15] China's central bank has promised support without signalling rate cuts. [14] One economist said the market is waiting for more government spending. [14]

Brent crude, the world's main oil price, rose as much as 5% to $109.80 a barrel on Monday. [10] It gave back most of that and finished 1% higher, at $105.68. [9] Buyers are paying a lot more for oil delivered now than for oil delivered in the coming weeks and months. [18] On Monday morning US crude for delivery in October cost $103.50 a barrel, against $93.64 for December. [19]

Why it matters. A higher price for oil today than for oil later is a warning that supply may struggle to keep up with demand. [18] Oil was at about $107 on Tuesday, near a four-month high, after the Houthis, an armed group in Yemen allied with Iran, attacked Saudi Arabia. [23]

The rate on 30-year UK government bonds, called gilts, rose to 5.951% on Monday, the highest since 1998. [20] The ten-year rate was 5.360%, close to Friday's 19-year high. [20] Traders worry that dear oil will keep inflation high for a long time. [20] The UK government sets out its budget on 28 October, and its debts are close to 94% of a year's economic output. [20]

Why it matters. Markets now expect four Bank of England rate rises by June 2027, up from two a week earlier. [20] Weak public finances and rising spending needs could push the UK government to borrow more. [20]

Few economists expect the Bank of England to change its rate this week, after a 6-3 vote to hold in July. [21] In July three members voted for a rise to 4.00%. [21] The bank will also vote on how fast it runs down the 895 billion pounds of UK bonds it bought between 2009 and 2021. [21] A July survey of investors pointed to a slower pace of 50 billion pounds a year. [21] Goldman Sachs now forecasts a rate rise in November, after expecting no change all year. [22]

Why it matters. A Morgan Stanley strategist estimates the shrinking of the bank's bond pile has added about 0.7 percentage points to 30-year UK borrowing costs. [21] Deutsche Bank expects the Bank of England to stop selling long-dated bonds altogether. [21]

The dollar index, which compares the dollar with a basket of other currencies, stood at 99.55 on Tuesday, near a two-week high. [23] The pound fell to $1.3474 on Monday, its lowest since 7 August. [24] The yen slipped from a seven-month high to 154.72 per dollar, before Friday's Bank of Japan decision. [23] Britain's economy grew 0.4% in July, when economists had expected no growth at all. [24]

Why it matters. An analyst at OCBC, a Singapore bank, said higher oil, higher US borrowing rates and nervous investors all lifted the dollar. [23] Higher rates usually strengthen a country's currency, but Reuters noted the effect is small when rates are rising in many countries at once. [24]

The US central bank announces its rate decision on Wednesday. [26] Traders put the chance of a rise at nearly 89%. [13] Kevin Hassett, who leads the US president's National Economic Council, said on television on Sunday that inflation is improving and a rise is not needed. [25] He also said President Trump would support whatever the US central bank decides. [25] Its chairman, Kevin Warsh, was picked by Trump and took over in May. [25]

Why it matters. Trump spent last year demanding rate cuts, so a rise from his own pick, before the US midterm elections, would test their relationship. [25] US retail sales for August are also due before the decision. [26]

Monsanto, the weedkiller maker owned by the German company Bayer, asked a Missouri judge on Monday to approve a $7.25 billion settlement. [27] It would settle nearly all current and future US claims that its weedkiller Roundup causes cancer. [27] People who were exposed to Roundup and developed non-Hodgkin lymphoma, a form of cancer, would receive $10,000 to $165,000. [27] Bayer denies that Roundup causes cancer, and its lawyer told the judge there is no other settlement. [27]

Why it matters. Objectors say the payouts are too small, since Roundup is still sold and studies suggest 80% of Americans have been exposed to its main ingredient. [27] Bayer faces about 65,000 claims in US courts. [27]

Aon, a big insurance broker, began a large bond sale on Monday to help pay for its planned purchase of USI Insurance Services. [28] It is expected to sell $13.5 billion of bonds, and the funding may also include a $4 billion loan, according to S&P Global Ratings. [28] Aon agreed to pay $17 billion for USI, which it is buying from the investment firm KKR. [28]

Why it matters. A deal this size is going ahead with the US ten-year borrowing rate near 5%. [9] It is the kind of work that pays banks the fees Bank of America says are falling. [1][28]

Sysco, a US company that supplies food to restaurants, is selling $1 billion of new shares. [29] The money will help pay for its $29.1 billion purchase of Jetro Restaurant Depot, a chain of wholesale stores for restaurant owners. [29] Goldman Sachs and Toronto-Dominion Bank are running the share sale. [29]

Why it matters. Share sales like this one are part of the dealmaking work whose fees Bank of America says are down about 10% across the industry. [2][29]

Vista Equity Partners, a private investment firm, is exploring options for Finastra, which makes software for banks, four people familiar with the matter told Reuters. [30] The options include a full sale, selling a stake, or a merger. [30] Valuations as high as $12 billion have been mentioned, and Blackstone is among the possible bidders. [30] Morgan Stanley is advising Vista, and the sources said a deal is not certain. [30]

Why it matters. Vista wants to sell while investors are buying financial software firms again, though they are unsure how AI will change what those firms earn. [30]

A newly formed UK Payments Delivery Company plans to start raising money on Tuesday, Sky News reported. [34] It will first seek about 50 million pounds from banks, lenders and payment firms, enough to run it through 2028. [34] Britain's largest banks want it to become the country's future system for moving payments. [34] Shares in Visa and Mastercard, the two big card-payment networks, fell on the report. [34]

Why it matters. It is a possible challenge to how much of Britain's payments Visa and Mastercard handle today. [34]

Six defence, space or satellite companies have announced mergers with SPACs this year, about 10% of all such deals, up from three in all of 2025. [35] A SPAC is a company that lists on the stock market with cash first and finds a business to buy later. Ursa Major, which makes engines for missiles and rockets, agreed a $2.3 billion SPAC deal last month. [35] Its boss said a normal listing would have meant waiting for the market rather than serving customers now. [35]

Why it matters. At least seven other defence and space firms have listed through normal share sales this year, as government and company spending on satellites rises. [35]

Puig, a Spanish beauty and perfume company, agreed on Monday to buy Esteve's 50% stake in ISDIN, a skin-care brand, for 1.2 billion euros. [31] It will pay 900 million euros when the deal closes and the other 300 million in early 2029. [31] The deal should close by the end of March 2027, if regulators approve. [31] Puig will pay with its own money and with borrowing. [31]

Why it matters. Puig is leaning further into skin care as demand for perfume settles and airport shops in the Middle East stay under pressure. [31]

Carlyle, a global investment firm, set up a new Canadian company, Avenrock Energy, to buy the oil and gas producer Parallax. [32] Sources put the deal's value at about 1 billion Canadian dollars. [32] Parallax produces about 20,000 barrels a day, counting its gas as oil, from about 300,000 acres in Alberta. [32] It is Carlyle's second Canadian energy purchase in 12 months, after Kiwetinohk Energy for about 1.4 billion Canadian dollars. [32]

Why it matters. Carlyle plans to build a Western Canadian light-oil business around Parallax. [32] The purchase comes while Brent crude trades above $100 a barrel. [9]

Equifax, a US company that sells credit checks to lenders, told a Barclays conference on Monday that the mortgage market is running at about half its historic level. [36] Its chief executive, Mark Begor, pointed to mortgage rates of 7% or more. [36] US mortgage rules now let all lenders use VantageScore, a credit score that Equifax is pricing at $1 until 2027, against FICO's $10. [36]

Why it matters. Begor said Equifax can still meet its growth targets without a housing recovery. [36] He said the slowdown is building a backlog of borrowers who may refinance later if rates ease. [36]

Sazerac, the family-owned US maker of Fireball and Buffalo Trace, said on Monday it had completed its purchase of Au Vodka. [33] A source told Reuters the deal valued the UK brand at more than 300 million pounds. [33] Two friends founded Au Vodka in Swansea in 2015. [33] Earlier this year Brown-Forman, the maker of Jack Daniel's, rejected Sazerac's offer of about $15 billion. [33]

Why it matters. Sazerac is growing in Britain through smaller purchases while its much bigger bid for Brown-Forman has been turned down. [33]

Addus HomeCare, a US company that sends carers into people's homes, agreed to buy the personal-care business of AccentCare for about $275 million. [37] That business serves about 13,700 people a day across 10 US states. [37] Addus expects it to add about $280 million a year in revenue, roughly 19% more. [37] It will pay with cash and a credit line. [37]

Why it matters. About 13,700 people who get help at home each day will have a new company running their care once regulators approve. [37]

Perdoceo Education, a US company that runs colleges, agreed to buy South University, a health-sciences university founded in Savannah, Georgia, in 1899. [38] South has eleven campuses in seven states, plus an online school. [38] After the deal closes, as early as April 2027, South will run as a for-profit institution. [38] Regulators and the bodies that accredit universities still have to approve it. [38]

Why it matters. Perdoceo says it will invest in clinical placements and licensing-exam preparation for South's health students. [38]

ABB Bank, from Azerbaijan, completed its purchase of 51% of Davr Bank in Uzbekistan, for about $140 million. [40] Davr serves more than 2 million customers through 43 branches and is strong in lending to small and medium-sized firms. [40] The deal was registered on the Tashkent Stock Exchange on 10 September. [40] After the purchase, S&P Global Ratings raised Davr's credit rating from B to B+. [40]

Why it matters. A better credit rating tells lenders a bank is safer, and Davr's two million customers now bank under the new ABB Davr name. [40]

Optasia, a company that runs small loans and money services through mobile phones in 35 countries, said first-half revenue rose 50% to $185 million. [41] Its mobile financial services grew 84% and now make up 72% of revenue. [41] It raised its full-year forecast to growth of 30% to 40%, from 25% to 35%. [41] It reaches more than 100 million customers a month. [41]

Why it matters. The company is moving from lending phone credit toward loans for shopkeepers, now live in Ghana and Uganda. [41]

Watsco, a US supplier of heating and air-conditioning equipment, agreed on Monday to buy The Granite Group, a family-run plumbing and heating supplier. [39] Granite sells about $500 million a year through 82 locations in seven north-eastern US states. [39] It was founded in 1971 in Concord, New Hampshire, and serves about 11,000 customers. [39] Its current managers will keep running it. [39]

Why it matters. Watsco is pushing into plumbing, which it describes as a large market split among many sellers. [39]