Bank of America versus Citigroup
In 2016, so far, shares of Bank of America (BAC) have underperformed the financial sector, as well as broad markets. The Financial Select Sector SPDR ETF (XLF) represents the financial sector, while the S&P 500 SPDR ETF (SPY) represents the S&P 500 Index. Year-to-date, the financial sector has lost 0.3%, while SPY has gained 6%. In comparison, Bank of America has shed 7.4% during the year so far. Citigroup has underperformed Bank of America and has lost 9%.
Performance of peers
Since the beginning of 2016, the financial sector has been on a roller coaster ride due to fears of a global recession and a low interest rate outlook. Banks entered 2016 expecting four rounds of rate hikes. However, things have not turned out in their favor. Macroeconomic uncertainty has led to delays in subsequent rate hikes. This has further weighed on banking stocks.