It's already shaping up to be a bad quarter for Wall Street banks

By Portia Crowe

Investment banks across Wall Street could be in for a disappointing third quarter. In a research note published Monday August 3, Deutsche Bank's Matt O'Connor highlighted three reasons why the the next set of results might disappoint:

The first month of the quarter, July, was quiet.
September could be rough because of holidays (Labor Day is later than usual this year and Yom Kippur also falls in September). It will be tough to compete with last year's strong performance in August and September.
The research note forecasts a 10 per cent drop in revenues from fixed income trading, with credit, mortgage and commodities trading likely to be weak. Investment banking fees are expected to be flat, while equity trading revenues are forecast to rise 5 per cent.

The note said: "Our bias is that both FICC [fixed income, currencies and commodities] and investment banking fees may be worse than expected. Equity trading may once again be better than expected."

Here's a rundown of activity in the key markets so far this quarter, via the Deutsche Bank note:



There's one big wildcard that will be hard to prepare for: the Fed.

The Federal Open Market Committee is set to meet September 16-17, and could potentially raise interest rates for the first time in years.