Wall Street is having its best year ever — and rising bond yields may be about to spoil the party. A new report from the New York State Comptroller shows the city's securities industry hauled in $45.9 billion in pretax profits in the first half of 2026, up 51% from a year earlier.
The report, authored by State Comptroller Thomas DiNapoli, covers NYSE member firms. The scale is hard to overstate: New York City had officially forecast $45.3 billion for the entire year, expecting a 30% decline as earnings normalized. Wall Street beat the full-year forecast in six months. At the current pace, 2026 profits could exceed $90 billion — smashing the $65.1 billion record set in 2025 and outpacing the inflation-adjusted record from 2009.
"Despite geopolitical tensions and economic uncertainty, the industry has remained resilient," DiNapoli said in a statement. Virtually every major revenue stream grew, with underwriting posting especially strong gains.
Three engines powered the boom: massive AI capital spending, elevated trading in a volatile market, and dealmaking revived by a relaxed regulatory environment.
AI was the standout. The Comptroller's office estimates U.S. AI capex will top $581 billion this year, and hyperscalers are raising money for chips and data centers through capital markets — every bond, share sale and acquisition generates fees. Global equity issuance surged 76.5% in the first half, helped by SpaceX's record June IPO; global investment banking revenue hit $61.4 billion, up 24% year over year, according to Dealogic data.
Trading itself was comparatively tame: trading revenue rose just 1.8% to $40.3 billion, while underwriting revenue jumped 68%. Wall Street collected a toll at nearly every intersection money passed through.
Bank earnings confirmed the frenzy: Goldman Sachs posted EPS of $20.98 against a roughly $14.50 estimate; JPMorgan reported its highest quarterly profit ever at $21.2 billion; Bank of America logged its 17th consecutive quarter of trading revenue growth; Citigroup posted its best quarterly revenue in a decade at $24.8 billion. Goldman's investment banking backlog sits at a five-year high.
But the good times may be peaking. On Monday, the 10-year Treasury yield — the benchmark that sets borrowing costs across the economy — hit 5.35%, its highest level since 2002. DiNapoli warned that rising rates "may dampen profitability" if dealmaking slows down or firms' interest liabilities rise significantly.
Higher yields push up the cost of borrowing from mortgages to auto loans, weighing on economic activity. They also raise risks for the stock market and could chill the hot IPO and dealmaking market. "Rising yields for bonds issued by the U.S. and other governments in recent weeks are another concerning indicator for investors," DiNapoli wrote.
The irony is that Wall Street's celebration is detached from the economy most Americans live in. Consumer sentiment hovers at historic lows amid the cost of living, from rising energy prices to stubborn food inflation. Federal Reserve Bank of New York data show total household debt hit a record $18.8 trillion in the first quarter of 2026, with Americans owing more than $1 trillion on credit cards and delinquencies climbing to levels not seen since the aftermath of the Great Recession.
Wall Street bonuses are expected to hit an all-time high while families lean on borrowed money to get by. That contrast is itself the biggest uncertainty for the second half: if high rates finally crush consumer spending and corporate financing demand, Wall Street's fee machine slows too. The coming weeks of third-quarter bank earnings will be the first test of whether the machine is still humming.