{"id":77748,"date":"2023-10-28T06:46:01","date_gmt":"2023-10-28T10:46:01","guid":{"rendered":"https:\/\/ifintechworld.com\/investing\/bank-of-america-jpmorgan-shares-drop-as-bank-sector-suffers-broad-beating\/"},"modified":"2023-10-28T06:46:04","modified_gmt":"2023-10-28T10:46:04","slug":"bank-of-america-jpmorgan-shares-drop-as-bank-sector-suffers-broad-beating","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=77748","title":{"rendered":"Bank of America, JPMorgan shares drop as bank sector suffers broad beating"},"content":{"rendered":"
\n

Banking stocks were taking a broad beating Friday as uncertainty about the health of the economy and an apparent lack of positive catalysts continue to give investors pause.<\/p>\n

The Financial Select Sector SPDR exchange-traded fund
\n XLF
\n dropped 1.7% toward a seven-month low in afternoon trading, with 67 of 72 equity components losing ground. The ETF has shed 5.1% month to date and was headed for its first three-month losing streak since April 2022.<\/p>\n

\n

The SPDR S&P Bank ETF
\n KBE
\n slid 2.6% in afternoon trading and the SPDR S&P Regional Banking ETF
\n KRE
\n sank 2.7%, on pace for largest percent decline since Oct. 18, when it lost 2.72%.<\/p>\n

The KBW Nasdaq Bank Index
\n BKX
\n was down 2.6% to $71.51. It\u2019s on track to close at its lowest level since September 25, 2020, when it closed at $71.08, according to Dow Jones Market Data.<\/p>\n

In comparison, the S&P 500
\n SPX
\n fell 0.4% while the Nasdaq Composite
\n COMP
\n rallied 0.4%.<\/p>\n

Also read:<\/strong> S&P 500 on track to join Nasdaq in correction territory as stocks head for another weekly loss<\/p>\n

JPMorgan analyst Vivek Juneja wrote that while the recent weakness in the sector may appear to have made valuations attractive, he recommended investors stay on the sidelines given \u201cuncertainty about the economic outlook\u201d and the implications of \u201chigher for longer\u201d interest rates.<\/p>\n

Besides just uncertainty, \u201cthe sector is lacking a catalyst near term,\u201d Juneja wrote in a note to clients, as commercial loans are weak, capital-markets issuance activity has slowed and the economic outlook is muddied by an election year.<\/p>\n

Among the Financial Select Sector SPDR ETF\u2019s more active components, shares of JPMorgan Chase & Co.
\n JPM,
\n -3.60%<\/bg-quote>
\n sank 3.5%, the biggest one-day drop since they fell 3.8% on March 17. It was headed for the lowest close since May 31.<\/p>\n

JPMorgan Chase said earlier that Chief Executive Jamie Dimon and his family plan to sell about $140 million worth of the bank\u2019s stock \u201cfor financial diversification and tax-planning purposes.\u201d<\/p>\n

Elsewhere, Bank of America Corp.\u2019s stock
\n BAC,
\n -3.64%<\/bg-quote>
\n dropped 3.7%, also the biggest selloff since March 17. The stock was headed for the lowest close since Nov. 6, 2020.<\/p>\n

Among the financial ETF\u2019s other large banks, shares of Citigroup Inc.
\n C,
\n -2.80%<\/bg-quote>
\n slid 2.5% toward a 3\u00bd-year low, shares of Wells Fargo & Co.
\n WFC,
\n -2.24%<\/bg-quote>
\n dropped 2.1% and shares of Morgan Stanley declined 2% to a 2\u00bd-year low.<\/p>\n

Regions Financial Corp.\u2019s stock
\n RF,
\n -2.91%<\/bg-quote>
\n slumped 2.8% toward the lowest close since Nov. 6, 2020, after Juneja cut his rating on the regional bank to neutral from buy and removed the stock from JPMorgan\u2019s Analyst Focus List.<\/p>\n

Juneja no longer sees a catalyst for Regions\u2019 stock to outperform its peers, and he believes the bank will need to invest more in cybersecurity given the \u201csurprising higher fraud costs\u201d the bank saw for the last two quarters.<\/p>\n

Banks are also wrapping up a mixed third quarter.<\/p>\n

Timothy Coffey, an analyst who covers regional banks at Janney, said one common theme across the sector during this earnings season is that higher interest rates will weaken demand for loans.<\/p>\n

\u201cAlmost every bank is reporting smaller loan pipelines (loans in application) not just year over year, but quarter over quarter,\u201d Coffey said in an email to MarketWatch.<\/p>\n

Steve Gelsi contributed.<\/em><\/p>\n

Also read: <\/strong>Higher-for-longer interest rates challenge banks as mixed third-quarter earnings stack up<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Banking stocks were taking a broad beating Friday as uncertainty about the health of the economy and an apparent lack of positive catalysts continue to give investors pause. The Financial Select Sector SPDR exchange-traded fund XLF dropped 1.7% toward a seven-month low in afternoon trading, with 67 of 72 equity components losing ground. The ETF […]<\/p>\n","protected":false},"author":1,"featured_media":77749,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[239],"tags":[83],"class_list":["post-77748","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-investing","tag-featured","post_format-post-format-video"],"yoast_head":"\nBank of America, JPMorgan shares drop as bank sector suffers broad beating | iFintechWorld<\/title>\n<meta name=\"description\" content=\"Banking stocks were taking a broad beating Friday as uncertainty about the health of the economy and an apparent lack of positive catalysts continue to\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=77748\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" 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