New York, Feb 12, 2026, 11:39 ET — Regular session
- Bank of America shares dropped roughly 2.8% in late-morning trading, following a broader slide among major U.S. banks
- Investors are bracing for Friday’s U.S. inflation report, a crucial factor shaping expectations around Federal Reserve rate moves
- This week, CEO Moynihan reaffirmed the targets for returns and growth in net interest income
Bank of America shares dropped roughly 2.8% on Thursday, slipping alongside other major U.S. banks as investors braced for a key inflation report that might shift Federal Reserve policy expectations. The stock settled at $52.32, having fluctuated between $51.94 and $54.20 during the session.
This shift is significant since bank stocks usually react to changes in interest-rate forecasts. Betting on lower policy rates can tighten net interest income — the gap between earnings on loans and costs on deposits — whereas prolonged higher rates might dampen loan demand and increase credit risks. 1
Traders are eyeing the U.S. Consumer Price Index for January, set to drop Friday at 8:30 a.m. ET. Any unexpected move could shake Treasury yields—and ripple through rate-sensitive stocks. 2
Top banks faced widespread selling. JPMorgan Chase dropped roughly 2.6%, Wells Fargo slipped about 2.5%, Citigroup declined near 3.7%, and Goldman Sachs lost around 2.6% during the same period.
Wednesday’s U.S. session was mostly quiet, but financial services lagged, with the S&P bank index dropping 2.6% as traders pulled back on rate-cut expectations. A global market strategist at New York Life Investments described the environment as “constructive,” noting it hinges on finding a “sweet spot” for growth that keeps future easing intact. 3
Wednesday’s jobs report kicked off the repricing, revealing faster payroll growth in January and a drop in the unemployment rate to 4.3%. This gave the Fed some leeway to hold steady while keeping an eye on inflation. 4
Bank of America is pushing investors to focus on its own growth drivers. CEO Brian Moynihan told a financial services conference on Feb. 10 that net interest income is expected to climb 5%-7% this year. The bank is targeting a 16%-18% return on tangible common equity—a key profitability metric excluding goodwill and intangibles—within the next 12 quarters. “Consumers in January spent 5% more money at Bank of America,” Moynihan noted, adding that the bank “probably” pours around $2 billion annually into technology development. 5
But those targets rely on assumptions that can change quickly. A hotter CPI number might drive yields up, keeping borrowing costs high. On the flip side, a sharp miss to the downside could revive talk of rate cuts, putting pressure on banks’ margin forecasts. Regulation adds another layer of uncertainty: stricter capital rules could limit buybacks and erode returns, even if revenues stay steady.
Bank of America’s next major event is its quarterly earnings report, set for April 15. Until then, traders will eye Friday’s CPI data closely — it’s the first major market mover of the week. Investors will also watch to see if bank stocks find support or continue to slide into the weekend. 6
