As JPMorgan’s co-CEO of CIB said recently, “There’s been a lot to navigate this year”. Echoing this sentiment, Goldman’s CEO said, “it's an environment with a lot of noise,” but also that the direction of travel is constructive. We tend to agree. The reversion to pre-pandemic revenue levels has not occurred, thanks to several forces creating tailwinds for Markets and Securities Servicing businesses, especially, although IPOs and “big M&A” are also making a comeback. Forces include higher interest rates, credit spreads, and continued global volatility. On the investment management side, while revenues from traditional public-market strategies face fee margin headwinds, a combination of asset expansion and allocations to higher-fee products are sources of growth, but also areas that need technology investment.
With the economic paradigm shifting from globalization to modern mercantilism, geopolitical tensions rising, and sustained competition from non-banks and fintechs, major investor assumptions are being challenged. Is fixed income still a diversifier for equity? Are Treasuries a risk-free asset? And what is a safe-haven asset for that matter? New markets in assets are developing and business models evolving. While the US has been the decades-long leader in terms of both investable assets and wholesale banking revenues, these shifts present new opportunities and challenges for global capital markets entities and their clients across the buy side, sell side, and financial market infrastructures. Leveraging those opportunities requires having the right technology strategy. Celent is here to help.
At the end of each year, Celent identifies the key business trends driving technology investment across capital markets. The 2025 trends are still relevant, although evolving, and we will soon be revealing our 2026 trends in our annual Previsory webinar and report series.
These themes also guide our research agenda throughout this year. Ever-evolving, each year the differences, however nuanced, become clear when evaluated in conjunction with specific market structures, regulatory trends, and emerging technologies on both the buy and sell sides.
In these challenging times, one thing is sure: none of us can go it alone. As you face hard decisions in the areas of technology and partnerships, Celent is here to support you. We can help you vet partners and technologies as you respond to competitive, market, and regulatory initiatives, as well as the changing needs of your customers and growing cost pressures.
As always, we’ll look to be nimble and respond to fast-moving developments in our research space. If you have a topic in mind where our research could add value to your organization, please get in touch so we can discuss and consider incorporating it into our quarterly research agendas in the coming year.
