Look out below!
Bank stocks (NYSE:XLF) are off to an awful start this morning after two key developments in the industry:
1) Bank of America Merrill Lynch (NYSE:BAC) smacked down competitors Goldman Sachs Group Inc. (NYSE:GS) and Citigroup Inc. (NYSE:C) with analyst downgrades to neutral. The Wall Street excel jockey claims first-quarter results from both banks will be weaker than previously expected.
2) The WSJ is reporting “U.S. banks received a 27-page proposal late Thursday from state attorneys general and several federal agencies that could require them to reduce loan balances of troubled mortgage borrowers.”