TrendsWide
Contact US
  • Home
  • Trending
  • Health
  • Life Style
  • NBA
  • Reviews
No Result
View All Result
TrendsWide
  • Home
  • Trending
  • Health
  • Life Style
  • NBA
  • Reviews
No Result
View All Result
TrendsWide
No Result
View All Result
Home Economie

Here’s why Bank of America stock price fell despite stellar Q1 results

by souhaib
April 15, 2021
in Economie
0
Here’s why Bank of America stock price fell despite stellar Q1 results
74
SHARES
1.2k
VIEWS
Share on FacebookShare on Twitter
ADVERTISEMENT


Shares of Bank of America Corp (NYSE: BAC) are trading in a volatile manner today after the company reported its first-quarter earnings. 

You might also like

‘momentum is continuing into 2022’

Astra Space stock closed down 20% on Monday: here’s why

Ripple, Dogecoin, Litecoin price forecast for February 2022

Profit more than doubled in Q1 2021

Bank of America Corp reported that its profit more than doubled in Q1 as the bank deployed reserves to compensate for potential loan losses amid the coronavirus pandemic. BofA released $2.7 billion from its reserves and announced a $25 billion stock repurchase program, expecting a rapid economic recovery boosted by vaccination programs. 


Are you looking for fast-news, hot-tips and market analysis?

Sign-up for the Invezz newsletter, today.

But the bank reported banking revenue dropped 12% to $8.1 billion in the quarter, while the net interest income plunged 16% to $10.2 billion during the same period.

“While low-interest rates continued to challenge revenue, credit costs improved and we believe that progress in the health crisis and the economy point to an accelerating recovery,” Brian Moynihan, BofA’s chairman and CEO, said in a statement.  

In 2020, the Federal Reserve introduced ultra-low interest rates to boost the economic recovery after taking a critical hit from the pandemic. However, such a monetary policy also hurts lenders including BofA, which capitalize on the difference between what they gain from loans and pay out on deposits.

Similarly, JPMorgan reported last week its loans and lease balances plunged across all of the bank’s divisions by 7% to $887 billion, affected by lower credit card balances and shortcomings in commercial loans.

Still, Bank of America officials said in January they believe the company could recover loan growth later this year after the demand for new loans faded amid the pandemic as customers were trying to save money and major companies turned to capital markets. 

Net income applicable to common shareholders climbed $0.86 per share to $7.56 billion, compared to $3.54 billion, or $0.40 per share, a year ago.

BofA’s results topped analysts’ profit estimates of $0.66.

The bank reported a 21% drop in pre-tax, pre-provision profit, which is considered the best measure of the lender’s performance this quarter, compared to JPMorgan which reported its first-quarter pre-provision profit was up 18%. Pre-provision profit in Wells Fargo & Co was down 13%.

Tip: looking for an app to invest wisely? Trade safely by signing-up with our preferred choice,
eToro:

visit & create account

Why did the shares fall?

Bank of America stock initially moved higher in pre-market Thursday before swinging to the red minutes before the open. Shares then plunged aggressively to currently trade 4% lower on the day. A plunge in the price action has stopped at $38.37, where the 200-DMA is located.

Here’s why Bank of America stock price fell despite stellar Q1 results
Bank of America hourly chart (TradingView)

A move lower came after the benchmark 10-year Treasury yield fell below 1.60% to send shares of all major banks sharply lower.KBW Nasdaq Bank Index (BKX), which tracks the performance of 24 leading banks, fell over 2%.

In essence, higher Treasury yields are hurting growth stocks, including almost the entire tech sector, as these companies suffer given that the value of their future cash flows falls. On the other hand, banks are profiting from higher rates.

Summary

Bank of America reported Q1 earnings, saying its profit in the quarter more than doubled as the company unlocked reserves to compensate for potential loan losses after the coronavirus crisis. 



Source link

Share this:

  • Twitter
  • Facebook
  • More
  • Pinterest
  • Telegram
  • Email
Share30Tweet19
Previous Post

Derek Chauvin trial: Defense set to call final witnesses

Next Post

Ian Roberts reveals the abuse he received after becoming the first NRL star to come out as gay 

souhaib

Recommended For You

‘momentum is continuing into 2022’

by souhaib
February 7, 2022
0
‘momentum is continuing into 2022’

Shares of Chegg Inc (NYSE: CHGG) are up 10% in extended trading on Monday after the student services company said it performed better-than-expected in Q4, despite COVID-19 uncertainty....

Read more

Astra Space stock closed down 20% on Monday: here’s why

by souhaib
February 7, 2022
0
Astra Space stock closed down 20% on Monday: here’s why

Read more

Ripple, Dogecoin, Litecoin price forecast for February 2022

by souhaib
February 7, 2022
0
Ripple, Dogecoin, Litecoin price forecast for February 2022

The cryptocurrency market is advancing this Monday, and this situation also supports the price of Ripple XRP/USD, Dogecoin DOGE/USD, and Litecoin LTC/USD. Bitcoin is trading above the $44,000...

Read more

Analyst: ‘Apple would be forced into it if Amazon goes after Peloton’

by souhaib
February 7, 2022
0
Analyst: ‘Apple would be forced into it if Amazon goes after Peloton’

Read more

Should I buy Uber shares in February 2022?

by souhaib
February 7, 2022
0
Should I buy Uber shares in February 2022?

Uber Technologies, Inc. (NYSE: UBER) will announce fourth-quarter earnings results this Wednesday, February 09, after the market closes. Uber shares have weakened more than 10% since the beginning...

Read more
Next Post
Ian Roberts reveals the abuse he received after becoming the first NRL star to come out as gay 

Ian Roberts reveals the abuse he received after becoming the first NRL star to come out as gay 

No Result
View All Result

Recent Posts

  • Dow Jones Futures: Market Rally Runs Up To Key Test; Here’s What To Do Now
  • femalemasteryformen.com Reviews 2022
  • Ukraine and Russia blame each other for new attacks on the Zaporizhia nuclear power plant
  • What Is Wholesale Clothes China?
  • Impression: Very good information for retirees and retirement savers — inflation may well be functioning in your favor

Browse by Category

  • Australia
  • Automotive
  • Business
  • Celebrity
  • Cryptocurrency
  • Deals
  • Economie
  • Education
  • Euro
  • Forex
  • Gaming
  • Health
  • Life Style
  • NBA
  • News
  • Reviews
  • Sports
  • Switzerland
  • Trending
  • U.S.
  • Uncategorized

Categories

  • Australia
  • Automotive
  • Business
  • Celebrity
  • Cryptocurrency
  • Deals
  • Economie
  • Education
  • Euro
  • Forex
  • Gaming
  • Health
  • Life Style
  • NBA
  • News
  • Reviews
  • Sports
  • Switzerland
  • Trending
  • U.S.
  • Uncategorized

Pages

  • Contact US
  • Newsletter
  • Privacy Policy
  • Terms & Conditions

© 2021 - TrendsWide

No Result
View All Result
  • Home
  • Contact US
  • Privacy Policy
  • Trending
  • U.S.
  • Economie
  • Deals
  • Reviews
  • Cryptocurrency
  • Health
  • Life Style
  • NBA

© 2021 - TrendsWide