Fed Hike Fails to Lift JPMorgan, Wells Fargo as Gains Price In
Bank stocks like JPMorgan and Wells Fargo declined despite the Fed's first hike in three years, as the market had already priced in the move and a flattening yield curve threatened to compress margins. Investors are now focused on management warnings that deposit costs are rising and credit risks are climbing, suggesting the sector's easy gains may be over.
Yahoo Finance details how a flattening yield curve, with the 10-year minus 2-year spread narrowing to 0.25%, is compressing the net interest margins that the rate hike was expected to widen. The report also highlights Jamie Dimon’s warning that current banking conditions are near their peak, coupled with rising card charge-offs of 3.33%.
Source: Yahoo FinanceMajor bank stocks fell despite the Fed's rate hike, driven by prior gains and rising credit risks.
Source: AOL.com
