Bank of America's stock plummeted 5.02% during intraday trading on Friday, mirroring a broad decline across the financial sector.
The selloff was driven by a combination of macroeconomic concerns weighing on bank stocks. Analysts pointed to renewed fears over credit risk and potential losses in private-credit markets, coupled with anxieties about how AI-related disruptions could impact the broader economy. Furthermore, rising Treasury yields and concerns about narrowing net interest margins for banks contributed to the negative sentiment, prompting a "flight to safety" rotation out of cyclical sectors like financials.
Adding to the sector-wide pressure, a warning from Bank of America's own chief equity strategist highlighted growing concerns about problem loans "under the hood" of the U.S. economy, which could signal mounting risks for financial markets. This combination of factors led to significant underperformance for financial stocks compared to the broader market during the session.
