REUTERS/Arko Datta
It's a tough time to be in the commodities business.
Goldman Sachs is rethinking its strategy in commodities after traders took a beating the first half of the year, according to Bloomberg.The investment bank has long dominated commodities trading on Wall Street, but after the unit suffered its worst start to the year in more than decade, Goldman Sachs is reviewing its strategy for the business, the report said.
Banks have struggled on commodities in recent years, leading many to pare back their trading operations.
Commodities revenues at the 12 biggest banks hit $800 million in the first quarter, according to data analytics firm Coalition, down from 1.1% in 2016 and $2.6 billion in 2012.
Goldman Sachs had been betting that the business would turn around, but the company is now reconsidering that position after the rough start to 2017, according to Bloomberg. The company's review isn't complete, and its possible no large-scale changes will result.
"Commodities has been and still is an important business for our clients and we will continue to invest in it to ensure we are best meeting their needs," Michael DuVally, a Goldman Sachs spokesman, told Bloomberg in a statement.
Coalition
Commodities revenues at the 12 biggest banks hit $800 million in the first quarter, according to data analytics firm Coalition, down from 1.1% in 2016 and $2.6 billion in 2012.
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