Bank of America stock plunges, leading selloff in shares of largest U.S. banks

Shares of many of America’s largest banks are falling sharply this week after a period of outperformance that saw Goldman Sachs Group
GS,
-2.32%

claw back practically all of its losses from earlier in the year.

Shares of Bank of America Inc.
BAC,
-4.26%

shares were down 5.5% Tuesday afternoon at $32.57, their lowest level since mid-October. Between Monday and Tuesday, shares of the North Carolina-based lender have fallen nearly 10%, leaving them on track for their worst weekly rout since June 2020, according to FactSet data.

Shares of Goldman Sachs Group Inc. JPMorgan Chase & Co.
JPM,
+0.17%

Wells Fargo Inc.
WFC,
-0.60%
,
Morgan Stanley
MS,
-2.56%

and Citigroup Inc.
C,
-1.45%

also suffered intense selling on Monday and Tuesday, leaving them on track for their biggest weekly drop since September, only two trading days into the week.

Weakness in bank shares hit the Financial Select Sector SPDR Fund exchange-traded fund
XLF,
-0.88%

 which has fallen more than 4% over the past two days, also putting it on track for its biggest weekly drop since September.

Market strategists highlighted news of layoffs at Morgan Stanley Inc. and Bank of America’s decision to slow hiring, while Steve Sosnick, chief strategist at Interactive Brokers, said the continuing inversion of the Treasury yield curve “is not great for banks that borrow short and lend long, even if the high fed-funds rate benefits banks that don’t pass along that benefit to their depositors.”

The selloff comes as investors have heard commentary from several megabank CEOs during a conference hosted by Goldman Sachs on Tuesday. Earlier, JPM CEO Jamie Dimon also spoke about the risk of a recession in the U.S. next year during an interview with CNBC.

The spread between the 2-year yield
TMUBMUSD02Y,
4.387%

and 10-year yield
TMUBMUSD10Y,
3.548%

 shrank as low as minus 86 basis points at one point on Tuesday, its most inverted level since 1981.

Source: https://www.marketwatch.com/story/bank-of-america-stock-plunges-leading-selloff-in-shares-of-largest-u-s-banks-11670356329?siteid=yhoof2&yptr=yahoo