Why Anthropic’s IPO ‘could be a deciding vote’ for Wall Street bank stocks

After a rally in the first half of summer, Wall Street banking stocks have lost some of their luster as rising interest rates threaten to cool the investment banking and trading booms that have fueled their profits.

Despite reporting strong third-quarter results in early October, signs of a slowdown in transactions and commercial activity began to intensify. The environment only raises the stakes for Anthropic’s highly anticipated public debut, which could happen as early as November 16.

Each of Wall Street’s five biggest banks has secured a mandate to help with Anthropic’s planned listing in November, according to the startup’s S-1 filing. On average, the IPO could represent an increase of around 0.8% for banks. fourth quarter results, according to Evercore calculations, based on fees collected from SpaceX’s June IPO. Goldman Sachs, Morgan Stanley and Citigroup are expected to see the biggest increases.

Overall, Anthropic’s IPO “could be a deciding vote” in the final quarter of 2026 for these banking giants, Evercore’s Glenn Schorr wrote to clients Tuesday.

So far in the fourth quarter, investors have already shown some selectivity towards Wall Street banking stocks. From the beginning of October through November 2, JPMorgan (JPM) stock is up 3%, while Goldman Sachs (GS) stock is flat and Morgan Stanley (MS) is down 1.2%, according to data from Yahoo Finance. Shares of Citigroup (C) and Bank of America (BAC) are down 5% and 9%, respectively.

The KBW Nasdaq American banking index (^BKX) is up more than 2% over the same period.

In October, global investment banking activity fell 25% from a year earlier, while U.S. stock trading volumes fell 8%, according to Dealogic data cited by Evercore ISI.

A broader Federal Reserve investigation released Monday, revealed that U.S. banks overall tightened their standards in the third quarter compared to the second quarter, reversing a trend of loosening standards seen over the past four quarters amid fiercer competition. Borrowing demand has also weakened across most loan categories.

Adding even more uncertainty to the picture is Wall Street’s growing skepticism about the AI ​​investment boom, which has driven a large share of the trading and trading fees that big banks have collected this year.

Anthropic’s IPO comes as investors appear to be rethinking how much they are willing to pay for the world’s biggest AI companies. In recent days, investors have told Anthropic and its advisers that the company’s valuation is expected to be between $1.5 trillion and $1.6 trillion, according to an article published Monday by The Wall Street Journal. report. The valuation range is well below the $2 trillion mark announced earlier this year.

“Good companies come to market with good stories. There is enough capital to support those stories at reasonable valuations,” Goldman Sachs CEO David Solomon said Tuesday at the Global Financial Leaders Investment Summit in Hong Kong.

Speaking alongside Solomon at the same event, Morgan Stanley CEO Ted Pick offered a similarly optimistic outlook on the AI ​​investment boom.

“We’re somewhere in the second inning of a nine-inning game,” Pick said, referring to the huge investments still expected in AI infrastructure.

Beyond Anthropic’s IPO, bankers are also closely watching the results of this week’s midterm elections. It is unlikely that even a Democratic victory will stop the Trump administration’s deregulation campaign, said Erika Najarian, an analyst at UBS, in a note published Monday.

“We believe there could be an acceleration in capital markets activity beyond the results, especially if the market begins to think about the possibility of a Democratic presidential victory in 2028, and therefore a tighter trading environment for deal making,” Najarian added.

Follow David Hollerith on X @DsHollers.