Bank of America (NYSE:BAC) finished off the trading week on Friday with its head above water, possibly because of the release of its annual report. Things look a bit different today, though, and I'm suspecting that it may have something to do with one particular nugget contained in that report that may have gotten stuck in investors' throats.
More bad news on the doorstep
The newsy morsel that B of A was being sued by the New York Attorney General's office for more shoddy mortgage products was quickly plucked from the 400-plus pages of the bank's 10-K form and bandied about gleefully in short order. After all, these types of lawsuits are a huge weight on B of A, and the width and depth of the problem is still unknown. It seems investors have chewed up and digested this news over the weekend, and they're not happy. Shortly before noon, the big bank is the volume leader in NYSE trading, and the outcome so far isn't stellar.
Bank of America's glum Monday is being shared by banking fellow JPMorgan Chase (NYSE:JPM), which may be suffering from the fallout from a New York Times article published over the weekend, which highlighted how it badgers its wealth management brokers to push its own products, whether they fit the client's needs or not.
Wells Fargo (NYSE:WFC) and Citigroup (NYSE:C) are looking sparkly, however, despite the news that Citi had boosted its estimates for legal and regulatory reserves to $5 billion at the end of the fourth quarter, up $1 billion sequentially. Wells, on the other hand, may still be basking in the glow of Warren Buffett having recently bulked up on the bank's shares, which now constitutes the Oracle's No. 1 investment holding.
The day's not over, though, and the market may yet be a bit kinder to B of A, particularly as investors look forward to the Fed's stress test results, coming out in just a couple of days. Of course, as Foolish, long-term investors, we recognize the need to keep the one-day jumps and jives of a stock in perspective. Even stocks have good days and bad days, so it's important to realize that sometimes they're not portents of dire news, but merely squiggles that we can safely ignore.