What Happened?
A number of stocks fell in the afternoon session after reports revealed a drop in consumer confidence amid mounting fears of a potential U.S. government shutdown.
The Conference Board's Consumer Confidence Index fell to 94.2 in September, a larger-than-expected decline fueled by pessimism over inflation and the job market. This drop suggests consumers may cut back on borrowing and spending, directly impacting banks' profitability.
Adding to the concerns, Federal Reserve Vice Chair Philip N. Jefferson highlighted a cooling economy, with GDP growth slowing to 1.5% in the first half of 2025 due to weaker consumer spending. Compounding these issues is the looming threat of a U.S. government shutdown, as a deal on a spending plan remains elusive. A shutdown could further squeeze the economy and delay crucial economic data, increasing market uncertainty and prompting a cautious approach from investors.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Thrifts & Mortgage Finance company Ladder Capital (NYSE: LADR) fell 3.5%. Is now the time to buy Ladder Capital? Access our full analysis report here, it’s free.
- Regional Banks company The Bancorp (NASDAQ: TBBK) fell 3.9%. Is now the time to buy The Bancorp? Access our full analysis report here, it’s free.
- Regional Banks company Coastal Financial (NASDAQ: CCB) fell 5.1%. Is now the time to buy Coastal Financial? Access our full analysis report here, it’s free.
Zooming In On Coastal Financial (CCB)
Coastal Financial’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 4 days ago when the stock gained 3% on the news that the stock continued to rally as TD Cowen initiated coverage on the stock with a 'Buy' rating and a price target of $140.
The positive assessment from analyst Steven Alexopoulos appeared to boost investor confidence. This sentiment contributed to the stock reaching a new all-time high of $118.08 during the session. The initiation of coverage by a firm like TD Cowen often brings fresh attention to a company's shares.
Coastal Financial is up 28.4% since the beginning of the year, and at $108.85 per share, it is trading close to its 52-week high of $118 from September 2025. Investors who bought $1,000 worth of Coastal Financial’s shares 5 years ago would now be looking at an investment worth $8,885.
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