Goldman Sachs Stocks Experienced a Momentary Spike After David Solomon Was Announced as New CEO
The market opened Tuesday morning with Goldman Sachs Group Inc. shares up .61, or .26% at 232.05 shortly after the company announced veteran investment banker David Solomon would replace Lloyd Blankfein as CEO and chairman in October. Pre-market shares spiked 1.27% to 234.38 at 7:31 a.m. ET.
News of the power transference came alongside an encouraging announcement of the bank’s second-quarter earnings, revealing higher profit and revenues from this time last year. Although Goldman experienced its strongest first half since 2009 with $2.6 billion in profits on $9.4 billion in revenue, trading results have fallen short.
Firm shares dropped as optimism about the presidential election and its effect on trading activity and the loosening of rules faded. Goldman’s shares were the worst performing among big U.S. banks this year, down nearly 9%.
Solomon will head the firm’s belated push into consumer banking. Goldman plans to diversify away from trading operations and move towards a broad-based offering of savings accounts, credit cards, and wealth-management tools.
“David is the right person to lead Goldman Sachs,” Blankfein said in a statement, applauding his successor and his track record of developing new businesses and working to improve Goldman’s culture.
Since Solomon’s official appointment, that optimism might have returned—at least for two minutes. At 9:43 a.m. ET, shares dipped 2.91, or 1.26% at 228.53.