Bank Of America's Stock Reverses Higher Ahead Of Fed Rate Announcement

Shares of Bank of America Corp. swung to a 1.2% gain just minutes ahead of the Federal Reserve's second expected interest hike since the end of the financial crisis, and the first in a year. The stock was down as much as 1.7% at its intraday low, before starting its rally. The Fed is widely expected to announce at 2 p.m. ET that its target range on the fed funds overnight rate will be raised by 0.25 percentage points. Higher interest rates can help boost bank profits, by increasing the spread they earn by funding longer-term assets, such as loans, with shorter-term liabilities. Shares of other sector heavyweights also turned positive ahead of the Fed announcement, Citigroup Inc.'s up 0.3%, J.P. Morgan Chase & Co. gaining 0.2% and Goldman Sach Group Inc.'s stock climbing 0.5%. Wells Fargo & Co. shares fell 1.9%, but pared earlier losses of as much as 3.2%, after regulators placed growth restrictions on the bank until the problems found with its "living will" plan are cleared up. The SPDR Financial Select Sector ETF eased 0.1%, but was down 1.1% earlier. The ETF has soared 22% over the past three months, while the S&P 500 has gained 6.8%.