Big bank stocks extend decline as BofA forecast weakens sentiment
XLF•Big U.S. banks extend losses after BofA forecast
Selloff in shares of big U.S. banks continued on Tuesday, following Bank of America's weak Q3 investment banking forecast.
- Goldman Sachs (GS.N) dropped 3%, JPMorgan Chase (JPM.N) lost 1.6%, Bank of America (BAC.N) ticked down 0.9%, Morgan Stanley (MS.N) fell 2.3%, and Citigroup (C.N) dipped 1%.
- The S&P 500 Banks index (.SPXBK) declined 0.9%.
- On Monday, BofA's CEO projected Q3 investment banking fees at $1.6 billion to $1.8 billion, with flat sales and trading revenue.
- "The BofA revelation ... is causing some jitters. The mega-IPO environment did not carry over in 3Q, and weekend concerns about the pace of AI development may slow it further" - Stephen Biggar, director of financial services research at Argus Research.
- A steep rise in the benchmark 10-year Treasury yield has also weakened sentiment.
- "The concern is this rate environment lasts for months and shows a lot of negative impact on growth for Q4" - Brian Mulberry, chief market strategist at Zacks Investment Management.
