Investing

Bank stocks jump almost 12% as traders bet on less regulation in a Trump presidency

In this article

Omar Marques | Lightrocket | Getty Images

Shares of major banks climbed in overnight trading as investors expected Donald Trump’s victory in the presidential election.

Citigroup jumped about 5% in special late trading on the Robinhood brokerage for well-known stocks. Bank of America added more than 3%, while Wells Fargo and Goldman Sachs each popped more than 2%.

These moves come as traders followed results trickling out on the race for the White House. Former President Donald Trump is currently leading by NBC News’ count, though several key states have yet to be called. NBC did project Trump to win swing state North Carolina.

Bank stocks are expected to benefit under GOP control given the party’s posture toward deregulation. TD Cowen analyst Jaret Seiberg noted a pullback on Consumer Financial Protection Bureau oversight can particularly benefit finance names.

“Donald Trump is the candidate where you ignore what he says and focus on what you expect him to do,” Seiberg wrote in a note to clients recently. “It is why he offers the promise of deregulation for financials as his regulators are likely to roll back much of the CFPB enforcement agenda and rethink safety and soundness changes for big banks.”

Seiberg said trading banks can specifically gain given the likelihood of lower capital requirements, credit card late fee policies remaining and help on crypto regulations. But he warned that there’s downside risk tied to Trump’s plans for tariffs and deportations, which can said could be inflationary.

Articles You May Like

AI startups are snatching up San Francisco offices, using Zoom fatigue to recruit talent
Top Wall Street analysts tout these energy stocks for attractive dividends
More Americans are living in malls, as developers get creative to help ease the housing crisis
With $10B on tap, bond volume set to break record
Romania scraps presidential election after alleged Russian meddling