October 9th, Gronghui｜JPMorgan and Wells Fargo & Co. will kick off the earnings season for the US banking industry on Friday, as strong employment data have increased uncertainty about the future rate cuts by the Federal Reserve. Investors are expected to focus on the two big banks' forecasts for net interest income. Market analysts predict that the profits of both banks in the third quarter may shrink due to persistently low loan demand, leading to a potential decrease in interest income. "Our economists expect another 150 basis points rate cut by mid-next year, and the economy will avoid a recession, so we believe the focus will quickly shift to forward-looking prospects," wrote Betsy Graseck, a Morgan Stanley banking analyst, in a report. Oppenheimer forecasts that investment banking revenue for all banks is expected to grow by an average of 7%, a good increase indeed, but still not back to historical levels. Moody's analysts said the trading departments may benefit from market volatility recovery, but considering the seasonal slowdown usually seen in the third quarter, revenues may still decline compared to the second quarter.