NEW YORK (CNNMoney.com) -- Wild swings in the stock market late in the second quarter should hit securities trading results as the nation's top three banks gear up to report earnings in the coming week.

Analysts are expecting generally positive reports from banking titans Citigroup (Charts), JPMorgan Chase (Charts) and Bank of America (Charts), courtesy of strong investment banking trends and benign credit quality. But trading could be the bothersome blemish that overshadows the banks' solid performance and drives some nervousness in the market.

According to earnings tracker Thomson First Call, Citigroup is expected to have earned $1.06 a share in the second quarter, while JPMorgan could post earnings of 87 cents a share and Bank of America is expected to report second-quarter earnings of $1.10 a share.

While all three companies are showing year-over-year earnings growth, investors are going to be more concerned about the companies' trading results in the quarter and will look for signals that their strong capital markets business may be headed for trouble in the second half and beyond.

"Trading will be front and center given what feels like a difficult market environment in mid-May and June," said Jason Goldberg, research analyst at Lehman Brothers.

On the plus side, analysts are still hopeful that any weakness in trading will still be marginal in the second quarter.

Piper Jaffray analyst Andrew Collins said trading revenue for Citigroup should decline 10 percent from the first quarter but will still jump 52 percent from the second quarter last year.

JPMorgan, likewise, which has a large proprietary trading operations and has been hammered in the past during market volatility, could see trading revenue fall 18 percent from the first quarter, but on a year-over-year basis, trading results could soar 243 percent, Collins said.

And Bank of America could see trading revenue drop 14 percent from last quarter but surge 226 percent from a year earlier.

Still Collins was cautious about investment banking, saying that investment banking issuances in the industry slowed down dramatically in the last 45 days and traditional fixed-income trading data was weak among the investment brokers that already reported second-quarter earnings.

And that could signal trouble for the large commercial banks in the second half of the year.

Investment bankers, such as Goldman Sachs (Charts) and Lehman Brothers (Charts), felt the market's wrath even though the companies reported solid second-quarter results, bolstered by investment banking strength.

The companies' trading results and investment banking operations managed to miss most of the market carnage because the brokers are on a fiscal reporting cycle and closed their second quarter as of May 31.

But investors hammered the stocks after the companies warned that continued market volatility poses a second-half problem for trading as well as other key investment banking operations such as the IPO generation.

Now all eyes are turned towards Citigroup, JPMorgan and Bank of America to see if the banks will echo those sentiments as they enter the seasonally soft third quarter.

Lehman's Goldberg said there is no doubt that continued market volatility could put pressure on some investment banking transactions. But he added that all three companies continue to have strong pipelines, and the M&A market continues to be hot given the emergence of private equity sponsors and the presence of excess capital on Corporate America's balance sheet.

That should fuel some power for banks with large investment banking operations.

And that's important for the Big 3 banks, which have turned in large part to their capital markets operations for strength in recent quarters, as rising interest rates dampened their consumer lending business.

Analysts expect the banking industry will continue to feel the pain of a relatively flat yield curve, which refers to the slope of rates in the Treasury bond market. Banks and securities firms borrow money at short-term rates and lend at long-term rates. A flat yield curve, therefore, squeezes margins.

Rising interest rates are also expected to continue to slow down mortgage activity, which will also hurt some of the commercial banks, said Punk Ziegel & Co. analyst Dick Bove.

Of the three, JPMorgan should see some weakness in its retail business given some slowdown in auto and home lending, which has been an important business for the company.

That makes capital markets strength so important and the reason why Wall Street is keeping a close eye on trading and investment banking results from the large commercial banks.

Still there are other pockets of strength that could benefit the Big 3 banks even if capital markets face a slowdown in the near term.

Piper Jaffray's Collins said that commercial loan growth for the industry should remain healthy and will offset the slowing consumer loan activity.

And credit quality will continue to be strong in the second quarter due to an unusually low amount of bankruptcy filings.

Banks were hammered last year as consumers rushed to file for bankruptcy before the tougher bankruptcy regulations went into effect last fall. But since then, bankruptcies have dwindled resulting in fewer defaults on loans and credit cards - a plus for banks.

Still, the unusually benign credit environment is likely to come to an end in future quarters, said David Easthope, analyst with the securities and investment group at independent research and consulting firm Celent LLC. And he said that should start to weigh on bank earnings going forward.

"I think there will be some deterioration but would be looking more for signs of that in the next quarter," Easthope said. "I'd be looking for more weakness in the summer and signs of conditions going back to a more normalized state."

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