Bank stocks tumbled after former President Donald Trump secured a second term in the White House. The Financial Select Sector SPDR Fund (XLF) rose more than 6% in intraday trading on Wednesday, with names like JPMorgan Chase (JPM), Bank of America (BAC), Wells Fargo (WFC) and Goldman Sachs (GS) gaining. KBW Director David Konrad joins Josh Lipton on Asking for a Trend to discuss why Trump’s victory has sent the industry higher and what bank investors are looking for from his second term.

Konrad says, “There are three main factors, all to some extent some kind of surrounding deregulation,” that have sent bank stocks higher: less antitrust regulation leading to more mergers, lower capital restrictions and less pressure from the Consumer Financial Protection Bureau ( CFPB) on the banks. consumer reimbursements.

“The other factor could be a little bit of concern about the inflation implications of the Trump administration, and that’s why people are looking for more asset-sensitive names for kind of higher returns, and those are really the real outperformers doing that. We saw it today.”

Watch the video above to learn more about Konrad’s expectations for the banking sector under Trump.

For more expert insights and analysis on the latest market action, check out more Questions for a Trend here.

This post was written by Naomi Buchanan.