Yesterday, American banks took a hit, and today the nervousness spilled over into Europe.

It was triggered by a comment from Brian Moynihan of Bank of America $BAC. He said that sales and trading revenues will be essentially flat year-over-year in the third quarter. Nothing dramatic in itself, but the market expected more. Bank of America shares then fell as much as 6% intraday on Monday, their biggest intraday drop since April 2025.

Today that sentiment transferred to European banks. The Stoxx 600 Financial Services is down about 2%, UBS is losing around 3%, Deutsche Bank 2% and UniCredit roughly 2%.

In my opinion, this shows how expectations are currently set for banks. When the sector has had a strong period, even a simple "we'll be roughly the same as last year" is suddenly enough to trigger a sell-off.

European banks have had really strong years, so now it will be interesting to see whether this is just short-term nervousness, or whether profit growth is really starting to slow.

Do any of you have European banks in your portfolio? What do you think about the banking sector?