What's Going On With Bank Of America (BAC) And Wells Fargo (WFC) Shares

Bank of America Corp BAC and Wells Fargo & Co WFC shares are trading lower Tuesday morning. Shares of banking and financial services stocks at large are trading lower after Moody's cut the credit ratings of 10 banks and placed others under review for potential downgrades.

Downgrades and potential downgrades of other banks in the sector can create a negative sentiment across the entire banking industry. Investors might become concerned that similar issues affecting the downgraded banks could also impact larger banks like Bank of America and Wells Fargo.

If several regional banks are facing credit rating downgrades, it could signal broader economic or financial sector concerns. Investors may worry that these issues could lead to increased credit risks, higher loan defaults and an overall weakened financial system, which could affect all banks, including larger ones like Bank of America and Wells Fargo.

What Happened?

Moody’s action comes amid worries about rising financing costs, possible weaknesses in regulatory capital, and escalating risks linked with commercial real estate lending. These concerns are heightened by the declining demand for office space.

“Although the general drain on deposit funding caused by quantitative tightening (QT) moderated in Q2, there remains a significant risk that systemwide deposits will resume their decline in the coming quarters,” Moody’s stated in the report...Read More

According to data from Benzinga Pro:

• BAC has a 52-week high of $38.60 and a 52-week low of $26.32
• WFC has a 52-week high of $48.84 and a 52-week low of $35.25