Bank of America shares declined slightly in extended trading Monday, underperforming a broader market rally led by technology stocks. The stock fell 0.3% to $56.41 after the closing bell.
Focus on Economic Indicators and Rates
Investors are preparing for a significant week of economic data, including the January nonfarm payrolls report and Consumer Price Index (CPI) figures. These releases are expected to heavily influence market expectations for future Federal Reserve interest rate decisions, a crucial factor for bank profitability. The 10-year Treasury yield settled near 4.20%.
Financial stocks broadly lagged behind the tech sector. The Financial Select Sector SPDR Fund (XLF) dropped 0.6%, while the SPDR S&P Bank ETF (KBE) fell 0.3%.
Analyst Outlook and CEO Commentary Ahead
In a notable move, JPMorgan increased its price target for Bank of America to $61.50, maintaining an Overweight rating. The firm's analysts cited a stable regulatory environment and expectations for only modest rate cuts this year.
Attention now turns to Bank of America CEO Brian Moynihan, who is set to address the BofA Securities Financial Services Conference on Tuesday morning. Market participants will scrutinize his comments for insights into consumer health, deposit trends, and the bank's capital strategy.
The key concerns for the banking sector remain the persistence of high deposit costs, loan demand sustainability, and potential credit quality pressures should the labor market weaken. While trading and investment banking revenues provide some buffer, they remain tied to volatile market conditions.
