Wild currency swings, M&A could be windfalls for Goldman, Morgan Stanley

Banks have not been where the money is so far in 2015. Since the beginning of the year, the financials have been among the worst performing sectors, in part due to stubbornly low interest rates. Given the environment, what should you expect from Bank of America (BAC), Citi (C) and Goldman Sachs (GS), all of which are due to report this week?

According to Leigh Drogen, the founder and CEO of Estimize, investors holding Bank of America, Citi and other big banks may be looking at lackluster price action.

[Get the Latest Market Data and News with the Yahoo Finance App]

On the plus side, “I don’t expect to see any big writedowns,” he said, suggesting that none of the banks are about to drop an earnings bombshell. “I do think we’ll see incrementally better results.” However, Drogan doesn’t see a catalyst that will drive earnings sharply higher, either.

The Fed has kept rates at historic lows and big banks struggle in a low interest rate environment. Looking at Goldman Sachs and rival Morgan Stanley (MS), Drogen sees reasons for optimism, largely due to volatility in the currency markets. The dollar has gained more than 10 percent against the euro just this year, a significant move “We expect that currency trading is going to be great. And Morgan and Goldman should make a ton of money on that.” (Although market volatility may make average investors nervous, it often benefit professionals because it allows them to take advantage of swings in markets to increase profits.)

However, of all the financials reporting, Drogen is most excited to hear from asset manager BlackRock (BLK). “They’re performing incredibly well and their ETF business is on fire. In the space this is one of our favorite names,” he said.

More from Yahoo Finance

Oprah, Kevin Spacey, Apple grabbing .sucks Internet names

China looks 'a lot like the U.S. in 2008'

Why nearly 200,000 of these good-paying jobs will go unfilled