Bloomberg Professional Services
In late April and early May 2025, Bloomberg held its flagship Sell-Side Leaders Forum in New York and London. Against the backdrop of ongoing tariff discussions, C-suite speakers focused on key themes related to evolving market dynamics and emerging opportunities.
The core themes of the discussion were as follows:
Navigating policy shifts
Banks and brokers are navigating growing geopolitical and policy uncertainty. From tariff realignment and supply chain disruption to U.S.–China tensions and unpredictable regulation, firms are modeling future shocks and adopting more defensive planning. Treasury yields remain near forecasts, but long-term strategies now account for diverse global regulatory regimes and evolving geopolitical alliances. Business leaders are focused on adaptability, visibility, and resilience as government priorities and trade terms evolve — often abruptly. Political volatility is now baked into capital allocation decisions.
Tracking U.S. changes
Five forces are reshaping the U.S. economic outlook: fiscal tightening, regulatory reform, energy transition, immigration policy, and tariff realignment. These structural shifts are influencing everything from investment flows to business location strategies. Executives are reallocating capital with caution, under pressure to boost efficiency amid rising costs, slower productivity growth, and the end of cheap capital. New operating models prioritize resilience and gradual change. While political noise dominates headlines, institutional planning is quietly adapting to a slower, more fragmented, and policy-heavy economic landscape.
U.K. banks resilience
Britain’s banks continue to grow and innovate, even as they contend with the continued impacts of Brexit and broader geopolitical headwinds. Foreign investment remains strong, with firms investing in technology and adopting a more agile approach to regulatory compliance. However, there is still room for greater cross-border consolidation and a more efficient IPO process to strengthen the sector. Challenges persist in talent acquisition, risk management, and integrating emerging technologies.
Rewriting rules with tech
The regulatory spotlight is turning to AI, electronic trading, and data governance. Policymakers aim to enable innovation without compromising market stability, but global coordination remains patchy. Banks are shifting toward more data-driven operating models to stay compliant while unlocking efficiencies. European regulatory reform is driving harmonization and supporting the rise of specialized data providers offering tailored solutions for compliance, trading, and analytics. U.S. regulatory scrutiny remains a core constraint on AI adoption. Oversight is tightening, but firms welcome regulatory clarity to support the practical use of AI in live operations.
Applying AI at scale
AI has shifted from broad experimentation to focused, real-world application. Sell-side firms are adopting generative AI and large language models to improve productivity, streamline research, support compliance, and personalize client service. While internal capabilities are improving, integration with legacy systems remains challenging. Human oversight is essential, and robotic process automation still handles simpler tasks. The focus is on execution, trust, and long-term integration — not hype. Leadership support and finding the right technical talent remain key obstacles for many institutions.
Managing market volatility
Market uncertainty is prompting a cautious, disciplined shift in strategy. Institutions are broadening their exposure across asset classes, using AI to sharpen risk strategies, and exercising capital discipline. M&A interest remains strong, but valuation gaps and policy ambiguity hinder deal execution. Leaders are prioritizing operational clarity and flexibility, preferring steady progress over bold bets. Analysts report a strong pipeline of mandates, but client hesitation is delaying outcomes. Deep shifts in technology, regulation, and market behavior are driving a careful, step-by-step approach across most sell-side desks.
Modernizing trading desks
Electrification of the trading floor is accelerating, particularly in fixed-income markets, driven by AI and algorithmic structures. Traditional market-makers are increasingly challenged by non-bank liquidity providers that leverage cutting-edge technology to undercut banks. However, electronic trading remains complementary to relationship-based trading, vital for higher-value deals and allows banks to draw on broader expertise and services when structuring transactions.
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