Investment Banks: Cleared for Takeoff in 2024

Investment banks are likely to do well in 2024 as capital market activity recovers. CEO confidence became positive in Q1 2024, which may create a "risk-on" environment. Investment banks hired senior bankers in 2023, indicating they expect a recovery to happen soon. We anticipate performance improvement will happen in the second half of 2024, due to long deal cycles and expected interest rate cuts. More "pure play" investment banks such as EVR, JEF, and LAZ may benefit the most from this recovery, while more diversified banks/brokers such as RJF and SF may face some challenges due to interest rate cuts.