NEW YORK, March 24, 2026, 16:23 EDT
- Bank of America closed Tuesday at $48.17, gaining roughly 1.4%, despite a weaker session for the major U.S. indexes.
- Traders are no longer factoring in Federal Reserve rate cuts for 2026, with Treasury yields and oil both moving higher. That’s pushed attention back onto bank lending income.
- Earlier this month, Bank of America projected first-quarter net interest income to rise at least 7%. But slower business momentum and mounting pressure in private credit are casting a shadow.
Bank of America Corp shares climbed Tuesday, with buyers favoring big banks as Treasury yields pushed higher again. The stock finished the session 1.4% stronger at $48.17. That move came while the S&P 500 slipped 0.36% and the Dow dropped 0.19%.
Investors have returned to trading Bank of America for its interest income story. Earlier this month, the bank projected first-quarter net interest income — that’s NII, the difference between loan and securities earnings and what it pays on deposits — will climb at least 7%. And on Tuesday, traders dropped any pricing for Fed cuts in 2026.
The group moved higher together. JPMorgan tacked on around 0.8%. Wells Fargo pushed up close to 1.7%, Citigroup advanced almost 1.9%. The Invesco KBW Bank ETF, meanwhile, picked up about 1.2%.
The spark? Climbing Treasury yields, after a lackluster two-year U.S. debt auction, and oil jumping more than 4% at the close. Investors weighed fatter bank lending margins against the risk of a cooling economy. “Watching oil and watching interest rates,” BMO Private Wealth’s Carol Schleif said of trader sentiment. And for Kevin Gordon at Schwab, this is a “stagflationary backdrop” — Wall Street code for a mix of rising prices and slowing growth. Reuters
Bank of America is pressing the argument for rates and volatility. Earlier this month, the country’s second-biggest bank projected a 10% bump in investment-banking fees for the first quarter. Co-President Dean Athanasia pointed to turbulence in capital markets and wealth management, calling them “all good revenues.” Reuters
Policy winds are blowing in Wall Street’s favor as well. Reuters said last week that new U.S. capital rule proposals could lower big banks’ capital requirements by 4.8% across the board, which might unlock billions for things like lending, buybacks, or dividends. “A good thing for the industry,” is how Christopher Marinac, director of research at Brean Capital, put it. Reuters
But things can reverse quickly. In March, U.S. business activity dropped to its lowest point in almost a year as energy prices climbed. Apollo Global and Ares, facing heavy redemption requests, restricted withdrawals from their private-credit funds — the non-bank lending vehicles. Apollo’s chief economist Torsten Slok said Tuesday that about $14 trillion in high-grade bonds is expected to hit the market this year, which he says is “putting upward pressure on rates and credit spreads.” If growth slows and credit tightens enough to outweigh banks’ bigger loan returns, the edge for lenders disappears. Reuters
The key for BAC: can stronger yields keep pushing up revenue before the economy loses momentum? Judging by Tuesday’s action, investors aren’t backing down yet. If oil prices hold up and credit starts to slip, though, the outlook gets murkier.
