Bank stocks drop as Treasury yields sink amid election uncertainty
Banks stocks took a broad hit Wednesday, to buck the rally in the broader market, as an uncertain election outcome triggered safe-haven buying, sending Treasury yields lower. The SPDR Financial Select Sector ETF XLF, -0.47% fell 1.3% in premarket trading. Among the ETF's most heavily weighted components, shares of J.P. Morgan Chase & Co. JPM, -2.29% dropped 2.4%, Bank of America Corp. BAC, -3.18% slid 3.0%, Citigroup Inc. C, -1.65% shed 2.4%, Wells Fargo & Co. WFC, -0.59% declined 2.5% and Goldman Sachs Group Inc. GS, 0.57% gave up 1.2%. The yield on the 10-year Treasury note TMUBMUSD10Y, 0.763% tumbled 11.1 basis points to 0.771%. Lower longer-term interest rates can hurt bank profits, as it narrows the spread banks earn on longer-term assets, like loans, which are funded by shorter-term liabilities. The bank stock selloff comes as S&P 500 SPX, 2.64% futures ES00, 2.88% rose 1.4%.
https://www.marketwatch.com/story/bank-stocks-drop-as-treasury-yields-sink-amid-election-uncertainty-2020-11-04
https://www.marketwatch.com/investing/bond/tmubmusd10y