# Bank of America Strategist Recommends Defensive Stance Ahead of November

- URL: https://stocks.freetheai.org/news/bank-of-america-strategist-recommends-defensive-stance-ahead-of-november-b87d2f
- Published: 2026-10-17T09:00:00Z
- Category: markets; sentiment: bearish; impact: medium
- Symbols: [NYSE:BAC](https://stocks.freetheai.org/symbols/NYSE-BAC)
- Written by our AI from expert market sources across the web for FreeTheAI Stocks, built by Vibhek Soni
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Bank of America Corp (BAC) strategist Michael Hartnett is advocating a defensive market posture heading into November. The warning reflects a combination of persistent borrowing costs, geopolitical conflicts in the Middle East and Ukraine, uncertainty surrounding the November 3 congressional midterm elections, and tightening scrutiny over artificial intelligence financing. Shares of Bank of America Corp (BAC) traded down 0.91% at $51.23.

High interest rates continue to raise corporate debt costs while making bonds increasingly competitive with equities. An expected Federal Reserve rate hike on October 28 aims to curb inflation, though a credible policy move could lower long-term Treasury yields by 20 basis points. Meanwhile, elevated oil prices threaten to squeeze corporate profit margins and household discretionary spending. AI infrastructure expansion is also facing challenges, marked by CoreWeave shares sliding over 22% in the week ending October 16 amid debt concerns.

Investors should monitor whether a decline in long-term borrowing costs provides breathing room for interest-sensitive areas, including small-cap stocks, real estate investment trusts, and consumer discretionary shares. Key focal points include the Federal Reserve decision on October 28, the upcoming congressional elections, and corporate earnings resilience under energy and funding pressures.

## Key points

- Bank of America strategist Michael Hartnett recommends a defensive posture due to elevated borrowing costs, geopolitical risks, and election uncertainty.
- Hartnett anticipates a Federal Reserve interest rate increase on October 28, which could potentially lower long-term Treasury yields by 20 basis points.
- High energy prices linked to conflicts in the Middle East and Ukraine are putting pressure on corporate margins and household budgets.
- Scrutiny over AI infrastructure funding led to a drop of over 22% in CoreWeave shares for the week ending October 16.
- Potential upside remains in small-cap equities, real estate investment trusts, and consumer discretionary stocks if long-term bond yields decline.

## Questions and answers

### Why is Bank of America recommending a risk-off strategy for November?

Bank of America expects stock market pressure due to high interest rates, geopolitical tensions in the Middle East and Ukraine, uncertainty over the November 3 midterm elections, and growing financial scrutiny on artificial intelligence investments.

### What does Bank of America expect the Federal Reserve to do with interest rates?

Strategist Michael Hartnett expects the Federal Reserve to raise interest rates again on October 28 to reinforce confidence in its fight against inflation.

### Which sectors could benefit if long-term bond yields fall?

Lower long-term yields could offer relief to small-cap stocks, real estate investment trusts (REITs), and consumer discretionary companies.