NEW YORK, Jan 2, 2026, 12:01 ET — Regular session
- Bank of America shares were up about 1% in midday trade as the new year got underway on Wall Street.
- Markets are juggling shifting expectations for 2026 rate cuts and a looming change in Fed leadership.
- Next catalysts include Bank of America’s Jan. 14 earnings report and next week’s U.S. jobs data.
Bank of America Corporation (BAC) shares rose 0.9% to $55.50 by 11:46 a.m. ET on Friday, beginning 2026 on a firmer note. The stock traded between $55.03 and $55.68.
The move comes as investors reset positions for the year with the interest-rate outlook back in focus. Bank stocks tend to react quickly because rates drive net interest income (NII) — the difference between what a lender earns on loans and what it pays to fund deposits.
Market pricing shows traders see only a 15% chance the Federal Reserve cuts rates this month, but they still expect two reductions over 2026. Investors are also bracing for President Donald Trump to name a successor to Fed Chair Jerome Powell later in January, another variable for rate expectations.
“The next Fed Chair is probably going to be much more dovish than Jerome Powell,” said Dennis Dick, chief market strategist at Stock Trader Network. He said investors were watching for signals that rates could fall later in the year, with next week’s labor-market data a key test. Reuters
Bank of America’s gains came alongside modest advances in other large lenders. JPMorgan Chase was up 0.1%, Wells Fargo added 0.6%, Citigroup gained 0.7% and Goldman Sachs rose 1.5%, according to market data.
Funding conditions also stayed in view after the year-end turn. Market participants said the Fed’s renewed purchases of short-dated Treasury bills and record use of its Standing Repo Facility — a backstop that lends cash against Treasuries — helped keep repo markets orderly.
Some investors are also watching the shareholder backdrop. Berkshire Hathaway has been whittling down its stake in Bank of America while building a record cash pile, as Greg Abel took over as Berkshire’s chief executive, a report said.
The next bank-specific catalyst is earnings. Bank of America is scheduled to report fourth-quarter 2025 results on Wednesday, Jan. 14, with a conference call set for 8:30 a.m. ET after a premarket release, the bank said.
Traders will focus on what management says about deposit costs, loan demand and NII as the market debates the pace of rate cuts. A steeper yield curve — when long-term rates sit above short-term rates — typically helps banks earn more on lending, though falling rates can also lift borrowing demand.
Credit quality is the other swing factor. Investors will look for changes in charge-offs and provisions — money set aside for potential defaults — across consumer cards, commercial real estate and corporate lending.
For now, BAC is trading on the same macro levers moving the sector: rates, growth expectations and policy risk. Jan. 14 is the next clear checkpoint, and investors will be listening for how the bank sees 2026 shaping up.
