Bank stocks continued their September swoon Thursday as the euphoria of the summer rally faded.

Analysts said optimism that the Federal Reserve policymakers had ended its round of interest rate hikes has been replaced by worry that bank earnings the rest of this year and next year will be weaker than had been expected. "The market is still coming to terms with the core earning perspective for banks in 2001, and this is adversely affecting bank stocks," said Catherine Murray, a banking analyst at J.P. Morgan & Co.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.