TheStreet's top fixed-income columnist Peter Tchir says investors could be disappointed by financials in the second half.

"They're going to get warnings on what's going on in the fixed income, rates, and currency-trading desk -- and [that's] what moves the needle," Tchir said during TheStreet's latest Trading Strategies roundtable for investors.

While some investors think Federal Reserve rate hikes could steepen the yield curve -- which is normally good for bank stocks -- Tchir said investors should focus more on financial firms' transaction-based businesses. After all, he noted that there's little long-term correlation between the yield curve and bank earnings.

Tchir cautioned that banks' transaction-based businesses have been fairly slow recently, which could serve as a drag on profits.

"I think you're going to get some earnings warnings," the columnist said. "I'm against the financials here."

Financials rode a high after Donald Trump won the election last November, with investors optimistic that the businessman would promote a pro-bank agenda. The rally cooled off in March, although banks are still having a positive year, with major North American banks up 7.2% year-to-date, according to FactSet data.

Citigroup (C) , JPMorgan Chase (JPM) and Wells Fargo (WFC)  all plan to report quarterly earnings on Friday.

How to Play 2017's Second Half

Our July Trading Strategies roundtable and accompanying special report highlights lots of ways to invest over the next six months. Click below to check out:

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