Citigroup says trading has slowed down in the second quarter following jubilant first quarter

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• Trading has slowed down on Wall Street in the second quarter, according to Citigroup CFO John Gerspach.
• The expected slowdown comes after a robust first quarter that saw some firms post record trading results.
• Gerspach said his firm's trading revenues were pacing to be flat compared with the second quarter of 2017.

The trading environment has slowed down in the second quarter this year, an expected drop-off from the hyperactive first three months of the year that saw some banks post record results, Citigroup CFO John Gerspach said.

Gerspach, speaking at a financials conference on Wednesday, said that his firm was pacing toward flat results in its trading business compared with the second quarter of 2017, with equities showing strength and the fixed income business showing struggles.

"From a trading revenue point of view, at the end of the first quarter, what we've indicated was that we would expect a normal seasonal slowdown in the second quarter. I'd say that, that is exactly what we're seeing right now in the results. That should mean then that we'll basically have flattish trading revenues," Gerspach said at the Morgan Stanley Financials Conference.

"I feel good about the equities results, but that's probably going to be offset by some lower revenues we have in FICC," Gerspach added, referring to the bank's fixed income, currency, and commodities trading business.

Gerspach's guidance echoes the sentiment coming out of JPMorgan Chase. Two weeks ago, Daniel Pinto, the head of JPMorgan's corporate and investment bank, said his firm was tracking for flat markets results for the second quarter as well.

Citi and JPMorgan each reported stellar equities results in the first quarter following a stock-trading period hit by sharp spikes in volatility. Fixed income trading has been sluggish by comparison.