UPDATE 1-Bank of America profit rises on trading boost
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July 14 (Reuters) - Bank of America BAC.N reported a rise in second-quarter profit, driven by strong trading activity as global market volatility prompted clients to reshuffle their portfolios.
Global markets remained volatile during the reported quarter, driven by escalating geopolitical tensions as the United States and Iran struggled to reach a peace agreement.
The ongoing conflict sparked deep uncertainty regarding global crude supplies, prompting a sharp spike in oil prices that largely drove a plunge in the S&P 500 energy sector in the second quarter.
Additionally, shifting interest rate expectations and stubbornly high inflation weighed on an otherwise robust quarter for major benchmark equity indexes.
The uncertainties forced market participants to take a cautious look at their holdings and reshuffle their portfolios in order to make the best possible returns from the markets.
Volatile markets tend to benefit large investment banks, as their trading desks generate higher revenue from increased client activity. Bank of America's sales and trading revenue came in at $7.1 billion in the second quarter, up from $5.3 billion in the year earlier.
The bank's CEO had expected a 15% jump in trading revenue for the reported quarter.
The bank reported a net income of $9.1 billion, or $1.21 per share, in the three months ended June 30, compared with $7.2 billion, or 90 cents per share, in the year earlier.