Goldman’s trading unit poised for 10% Y/Y drop, CEO David Solomon says

Goldman Sachs’s (NYSE:GS) trading division is on pace to post a 10% year-over-year drop this quarter, CEO David Solomon warned on Monday, led by declines in the fixed-income business.

At a Barclays conference, the 62-year-old pointed to tough Y/Y comps, as well as a more challenging and volatile trading environment, when telegraphing the trading unit’s sizable slump.

Solomon did take note of improving dealmaking activity, though he also cited certain challenges for that business, including slower activity from buyout firms.

Shares of the New York-based investment bank are up a solid 28% so far this year, propelled by a revival in its main investment-banking operations. The shrinking of its embattled consumer business also helped drive the stock higher.

The company’s Q2 earnings, released in mid-July, reflected “strong year-on-year growth in both Global Banking & Markets and Asset & Wealth Management,” Solomon said at the time. Debt and equity underwriting helped to fuel the year-over-year strength.