Stock Market Today, Oct. 14: Bank of America Shares Fall 5% on Earnings Miss and Compliance Penalty
Bank of America (NYSE:BAC), a global consumer, commercial, and investment banking franchise, closed at $51.39, down 4.76%. Premarket earnings missed estimates, and investors are watching trading revenue, compliance costs, and loan growth next. Trading volume reached 115.1M shares, coming in about 226% above its three-month average of 35.3M shares.
How the markets moved today
S&P 500 (SNPINDEX:^GSPC) closed at 7,721, down 1.08%, and Nasdaq Composite (NASDAQINDEX:^IXIC) closed at 26,693, down 1.88%. Among diversified banks and financial services peers, JPMorgan Chase (NYSE:JPM) closed at $335.28, up 1.16%, while Wells Fargo (NYSE:WFC) closed at $80.91, up 0.20%, highlighting a mixed day for large-bank shares.
What this means for investors
Bank of America briefly suffered its biggest single-day drop since April 2025 after missing Q3 earnings and being hit with a $1.2 billion fine from the U.S. Treasury Department yesterday for violating anti-money-laundering and sanctions laws.
The fine amounted to a $0.17 hit to EPS in Q3, but even without including this figure, BAC stock's EPS of $1.08 came up two cents short of what Wall Street was expecting. After being down nearly 10% early in the morning, Bank of America recovered roughly 5% throughout the day.
Ultimately, it was a mixed quarter for the mega-bank as:
- net interest income (NII) jumped 8%
- consumer banking revenue rose 4%
- wealth management revenue soared 13%
- global banking revenue was flat
- global markets revenue dropped 6%
- investment banking fees slid 11%
Management guided for NII to grow by 8% in 2027, up from previous guidance of 5% to 7%. While the fine certainly sticks out, it was mostly a "fine" quarter for BofA, so investors shouldn't overreact one way or the other.
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Wells Fargo is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Bank of America is an advertising partner of Motley Fool Money. Josh Kohn-Lindquist has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.
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