Investment bank stocks are set to benefit from the Trump presidency, according to investor Kingsley Jones, who said it was time for financials to “step up.”
Speaking to CNBC’s Martin Soong, the Australian investor struck a bullish tone on the outlook for stocks as U.S. President Donald Trump’s second term gets underway.
“Wall Street, in general, will do quite well out of the Trump presidency,” Jones, founder and chief investment officer at advisory firm Jevons Global, said.
He added that banks were particularly well placed, given Trump’s promise to loosen deal-making regulations and imposition of trade tariffs which could see businesses re-focus on the U.S.
“When you have a time of great change like this, which is very pro-business in the United States — a lot of talk about building new factories, plus shifting trade patterns — I think the financials will do pretty well,” Jones said.
“There’s a big need for investment banks to step up and finance whatever activity changes are going to happen,” he added, naming JPMorgan and Goldman Sachs as two stocks he particularly likes.
It comes after a record-breaking quarter for the banks, following bumper trading activity around the presidential election and more investment banking deals.
Trump’s return to the White House is expected to boost investment bank income to $316 billion in 2025, according to data and analytics group Coalition Greenwich, Reuters reported. The same data suggests that M&A bankers could earn around $27.6 billion in fees. If so, it would be the second-highest-grossing year in two decades.
Following Trump’s election victory in November, dealmakers and leaders on Wall Street said they expect the floodgates to open on merger and acquisition activity. Goldman Sachs CEO David Solomon echoed this sentiment in January, claiming that Trump had brought back “a meaningful shift in CEO confidence” and “increased appetite for dealmaking supported by an improving regulatory backdrop.”
Two-horse AI race
Elsewhere, Jones said the emergence of China’s Open AI model DeepSeek is set to spark a “boom” in artificial intelligence competition.
However, he said it’s firmly a two-horse race between the U.S and China.
“There’s going to be a boom in China of applications of these models, and also in the United States and elsewhere,” he said.
“[But] it’s those two nations that lead,” Jones said, adding that Europe is “starting from behind.”
