Bank of America Stock Falls 5% After CEO Warns Trading Revenue Will Be Flat, Investment Banking Fees To Drop Over 10%

Bank of America CEO Brian Moynihan told a room full of investors and analysts on Monday, September 14, that the bank's blockbuster run in trading and dealmaking is cooling off. The market didn't wait for the earnings report to react.

Speaking at the Barclays 24th Annual Global Financial Services Conference, Moynihan said Q3 2026 sales and trading revenue will be roughly flat compared to the $5.4 billion the bank posted in Q3 2025, according to Reuters. He also projected investment banking fees between $1.6 billion and $1.8 billion, down from nearly $2 billion a year earlier, a decline of more than 10%.

BofA shares fell as much as 5.6% in afternoon and late-day trading, according to Newsy Today, with Seeking Alpha putting shares at $59.38 shortly before Monday's close. The S&P 500 banking index dropped 2.7%, Reuters reported, and Crypto Briefing noted BofA was the worst performer in the KBW Bank Index. The selloff dragged down Goldman Sachs, Citigroup and JPMorgan as well.

Why the drop stings

The guidance is jarring mostly because of the quarter it's being measured against. Bank of America's Q2 2026 was a standout: trading revenue rose 33% year-over-year and investment banking fees jumped 50%, according to CNBC's reporting, cited by Traders Agency. A flat Q3 trading number would also snap what Newsy Today described as a 17-quarter streak of year-over-year sales and trading revenue growth for the bank.

Moynihan didn't frame this as a BofA-specific problem. "What we're seeing is the market generally in investment banking is down 10% or so," he said, citing Dealogic data, according to Reuters. He added that BofA's business mix could make its own decline steeper than the industry average: "We're not as well positioned in some of the businesses that have more activity, so we'll be down probably a bit more than that."

Moynihan also said the bank's deal pipeline, particularly in middle-market investment banking, remains "solid" and "full," per Reuters. He noted consumer spending and credit quality are "as good as it's been for a long time." He flagged one risk to watch: if interest rates rise further, that could slow financing demand. CNBC suggested the muted outlook "could be an early signal that Wall Street's AI-fueled advisory and trading boom might have hit turbulence," a framing Traders Agency noted is CNBC's interpretation, not a claim Moynihan himself made.

A rough day across the board

BofA's slide happened alongside a broader market downturn that had little to do with banking. The Dow Jones Industrial Average fell 0.3% to 52,421, the S&P 500 dropped 0.5% to 7,619, and the Nasdaq Composite slid 0.6% to 26,186, according to Kiplinger.

Much of that separate pressure traced to AI safety warnings. Anthropic CEO Dario Amodei published an essay over the weekend arguing "we must slow the pace at which we improve the capabilities of AI models," warning specifically about AI's capacity for self-improvement and unsupervised cybersecurity attacks. OpenAI's Sam Altman and xAI's Elon Musk echoed the call to slow down, Kiplinger reported. President Trump pushed back on Truth Social, writing that the only control AI needs is "a STRONG AND SMART (High IQ) PRESIDENT." The warnings hit chipmakers hard, with Intel down 5.6% and Nvidia down 3.4%, while cybersecurity stocks like CrowdStrike (+13.9%) and Palo Alto Networks (+13.1%) rallied.

Oil added another layer of pressure. West Texas Intermediate crude rose 1.3% to $101.39 a barrel after Saudi Arabia closed a pipeline that bypasses the Strait of Hormuz following damage from Iraqi drones, Kiplinger reported, part of a nearly 20% climb in oil prices this month. Treasury yields moved higher too, with the 2-year yield touching a two-year high intraday, ahead of the Federal Reserve's meeting later this week.

Bank of America's own equity strategist, Savita Subramanian, added a separate warning to clients Monday, noting the S&P 500 has had only one 5% pullback in 2026 against a historical average of three per year, and that no full 10% correction has hit since the spring 2025 "tariff tantrum," according to Newsy Today. She wrote that the market is "overdue for a pullback," pointing to September-October historically being the weakest two-month stretch for the S&P 500 going back to 1928, averaging a 0.6% decline.

Bank of America is scheduled to report full third-quarter results around October 14. That report will show whether Moynihan's flat-trading, weaker-fees guidance holds, and whether net interest income or wealth management picked up any of the slack he didn't mention on Monday.