Bank of America (BAC) shares tumbled 5.07% in pre-market trading on Thursday, as President Donald Trump's announcement of sweeping new tariffs sent shockwaves through the financial sector. The sharp decline comes amid growing fears that the escalating trade tensions could push the global economy into a recession, potentially impacting banks' profitability and loan growth.

The sell-off in Bank of America stock follows Trump's decision to impose a 10% baseline tariff on all imports to the United States, with higher duties on dozens of other countries. This move has sparked concerns about a full-blown trade war and its potential to destabilize the world trade order. As a result, investors are fleeing from riskier assets, including bank stocks, which are particularly sensitive to economic uncertainties.

Adding to the pressure on Bank of America, JPMorgan Chase has cut its price target for the bank from $49.50 to $43.50, while maintaining an overweight rating. This adjustment reflects the growing caution among analysts regarding the banking sector's near-term prospects. JPMorgan analysts have indicated a preference for global systemically important banks (G-SIBs) over regional banks in the current uncertain environment, citing Bank of America as potentially better positioned than peers due to its lower credit risk profile.