Bank stocks gained on Wednesday in premarket trade, as Donald Trump was elected the 47th President of the U.S. in the early morning hours.

The banking sector was responding to expectations that Trump's second presidency will lead to reduced regulatory pressures.

UBS in a note had said it expects U.S. financials to benefit from a Trump win, as higher bond yield helps life companies, higher rates help banks, deregulation helps M&A, potentially lighter capital requirements.

"We think broad deregulation, including in energy and financial services, will likely be a tailwind to growth. Increased energy production could marginally offset the increase in headline inflation from tariffs and fiscal easing," Barclays said in a note.

"We don’t expect the Fed to pre-judge the Trump policy agenda. But we think it will pause the cutting cycle if large tariff increases are announced, assuming the economy is still on solid footing," Barclays added.

Investors could eventually see outperformance by banks, consumer finance, brokers and title insurance stocks under a Trump administration, an earlier note by Keefe, Bruyette & Woods had said.

Bank stocks: Bank of America (NYSE:BAC) +7.7%, JPMorgan Chase (NYSE:JPM) +7%, Citigroup (NYSE:C) +8.6%, Wells Fargo (NYSE:WFC) +10.4%, Goldman Sachs (NYSE:GS) +7.4%, Morgan Stanley (NYSE:MS) +9.1%, U.S. Bancorp (NYSE:USB) +2.2%.