Regional bank stocks soared on Tuesday after the Consumer Price Index remained unchanged in October amid speculations that the Federal Reserve may have ended its rate hikes. Economists expected a 0.1% increase in inflation last month.
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Indeed, regional bank stocks jumped following the report. Banks such as Axos Financial (NYSE:AX), Western Alliance Bancorporation (NYSE:WAL), and Metropolitan Bank Holding (NYSE:MCB) surged over 16%, 10%, and 6%, respectively. In addition, KeyCorp (NYSE:KEY) and PacWest Bancorp (NASDAQ:PACW) both added over 10% at the time of writing.
Earlier this year, Regional banks plunged into a crisis as higher interest rates forced clients to transfer money from savings accounts to higher-yielding alternatives. As a result, their shares saw steep declines.
In contrast to the regional banks, the biggest U.S. banks witnessed relatively modest gains. JPMorgan Chase (NYSE:JPM) gained over 2%, while Bank of America (NYSE:BAC) and Wells Fargo (NYSE:WFC) increased by more than 5% and 3%, respectively.
What is the Best Regional Bank Stock to Buy?
Turning to Wall Street, MCB stock remains the leader in upside potential here. This Moderate Buy-rated stock offers 47.33% against its average price target of $55. Meanwhile, with an average price target of $12.58, KEY stock is the laggard, as this Moderate Buy-rated stock offers investors 5.85% upside potential.
