Oil and gold become "wealth creation" engines Bank of America Corp (BAC.US) first-quarter commodities trading business surged by 60%

Thanks to the sharp market volatility pushing the securities business of the largest banks in the United States to a historical high, Bank of America Corp (BAC.US) saw a 60% surge in commodity trading revenue in the first quarter. The financial report shows that the bank's Q1 revenue increased by 7% year-on-year to $30.3 billion, exceeding market expectations. Earnings per share also increased by 25% year-on-year to $1.1, surpassing market expectations. Net interest income reached $15.7 billion, up 9% year-on-year, mainly benefiting from increases in net interest income related to global market activities, deposits and loan balances, and repricing of fixed-rate assets. The co-heads of global markets business at the bank, Dennis Manelski and Sophie Zuberi, said that this growth was largely driven by the volatility of oil and precious metals, especially gold. Manelski said in an interview after the bank announced its first-quarter results on Wednesday, "The activity in these two categories in the first quarter was extraordinary." "This was largely driven by headline news." Due to the attacks launched by the US and Israel against Iran earlier this year, the global oil market was thrown into turmoil, effectively closing the critical oil and gas shipping route of the Hormuz Strait. The conflict also disrupted infrastructure in the Middle East, including oil fields, natural gas facilities, and ports. Precious metals also experienced significant volatility in the first quarter. The price of gold soared to a record high of over $5,400 per ounce, followed by a sharp decline in late January in the metal market crash. After recovering some lost ground, gold and silver prices fell again due to the outbreak of war in Iran. By the end of the first quarter, the price of gold had risen by 8.1%. According to executives, another major contribution to the significant increase in trading revenue within Bank of America Corp was international business, which saw a 23% increase from the same period last year, contributing 45% of the overall activity of the sales and trading division. Zuberi added that the company's main brokerage business and stock business in the Asia-Pacific region also set quarterly records. Zuberi said, "We are well-positioned to help clients execute trades in Asia, especially in the North Asian markets." On the performance conference call, Chief Financial Officer Alistair Borthwick said that stock trading volumes increased by 30% in the first three months of this year, benefiting from "increased client activity and capital investment to drive business growth." Borthwick said the company witnessed more client financing activities, especially in Asia, and the performance of derivative trading was also strong. Since US President Trump announced a series of tariffs on global trading partners last year, volatility has continued to impact the market. This volatility continued into 2026 due to turmoil sparked by the Iran war and concerns about artificial intelligence and private credit. The sharp market volatility is good news for the trading business of Bank of America Corp and its Wall Street counterparts, as these institutions benefit greatly from clients adjusting their positions. The bank's market department has seen year-on-year growth for the 16th consecutive quarter, with stock traders setting a single-quarter historical record. To keep up with competitors, the bank has continuously invested in trading business through increasing capital, recruiting talent, and increasing staff. After former head of the market department Jim Demaree was promoted to co-president of the bank in September last year, Manelski and Zuberi were appointed as co-heads. Manelski previously served as head of fixed income, foreign exchange, and commodity sales, while Zuberi was in charge of the stock sales and trading department. Manelski said in the interview that the ongoing conflict in the Middle East "significantly changed the investment environment." He pointed out that the duration of the war will have far-reaching implications for investors' future positioning and views on the global economy.