US Bank Stocks up Pre-Bell After Clearing Fed Stress Test

BY MT Newswires | ECONOMIC | 06/30/25 07:04 AM EDT

07:04 AM EDT, 06/30/2025 (MT Newswires) -- Major US bank stocks were up pre-bell Monday after the Federal Reserve said they passed the central bank's annual stress test.

"Large banks remain well capitalized and resilient to a range of severe outcomes," Fed Vice Chair for Supervision Michelle Bowman said Friday. "One way to address the excessive volatility in the stress test results and corresponding capital requirements is for the board to finalize the proposal that would average two consecutive years of stress test results, which was released in April."

The Fed said that all 22 banks tested continued to be above their minimum CET1 capital requirements during the stress scenario, after absorbing total projected hypothetical losses of more than $550 billion.

"Large banks are well positioned to weather a severe recession, while staying above minimum capital requirements and continuing to lend to households and businesses," the Fed said.

Goldman Sachs Group (GS) and Wells Fargo (WFC) shares were up more than 2% each in recent premarket activity Monday, with

Bank of America (BAC) , JPMorgan Chase (JPM) , Morgan Stanley (MS) and Citigroup (C) also showing gains.

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In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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