That shares of the nation's second largest bank by assets, Bank of America (NYSE:BAC), are down today, is no reason for concern. In the absence of a specific catalyst, it seems more likely that the trend is related to profit taking more than anything else.
As you can see in the chart below, B of A has convincingly outperformed its peers since the beginning of 2012. Including dividends, its shares are up 112% over this time period. The runner-up in this regard is Citigroup (NYSE:C), followed by JPMorgan Chase (NYSE:JPM) and Wells Fargo (NYSE:WFC), respectively.
Although shares of B of A are only higher by 1.75% since the beginning of this year, they've lately been riding on the coattails of its performance in the Federal Reserve-administered CCAR results, which cleared the bank to return $10.5 billion in capital to shareholders over the course of this year via stock buybacks.
It's for this reason, in turn, that many traders may feel like now is the time to take some profits -- and particularly in light of the impending three-day weekend, over which any number of things could happen in Europe or elsewhere to upset the proverbial applecart.
The one thing that could be pointed to on the macroeconomic front is a disappointing jobs report. For the week ended March 23, initial jobless claims rose 16,000 to 357,000. This underperformed both the previous week, in which 341,000 unemployment applications were filed, and the consensus estimate among economists calling for a figure of 339,000.
On the other side of the equation, however, was news that the economy grew at a faster clip in the last quarter of 2012 than originally estimated. According to the Bureau of Economic Analysis, the output of goods and services produced domestically increased at an annual rate of 0.4% compared to the preceding three-month time period. The growth rate had been pegged previously at 0.1%.
Getting back to B of A, then, the next big thing to watch is its earnings from the first quarter of this year, which are due out on April 17. And more specifically, shareholders will want to closely examine its progress at originating mortgages, cutting expenses, and insulating its trading profits from the ongoing turmoil in Europe.