Deutsche Bank is shifting its perspective on shares of Bank of America and JPMorgan as macro uncertainties loom.
Deutsche Bank is shifting its perspective on shares of Bank of America and JPMorgan Chase as macro uncertainties loom. Analyst Matt O'Connor downgraded shares of both banks to hold from buy in a note to clients Thursday, saying that the two stocks look poised for new lows as fundamentals weaken. "In some ways, it's tempting to get more positive given stocks are already down sharply, inflation seems to be slowing and Fed rate hikes may be coming to an end," he said.
" Looking ahead, O'Connor expects net interest rate margins to peak, loan growth to slow and credit costs to climb, viewing regional banks as more defensive given their lower exposure to credit card risks and global capital markets. "In this macro backdrop, we also worry investment banking fees will remain sluggish in this backdrop and trading will normalize more than expected," he wrote.
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