For banks and fintechs, especially those in the payments industry, the decline is probably due to a hangover effect from the Federal Reserve's 75-basis-point interest-rate increase on Wednesday. Rates have now increased 75 basis points each of the past three times the Fed has convened. Rising interest rates are the tool the Fed is using to slow down the economy and combat high inflation.
As Affirm (AFRM) will not charge late and hidden fees, it is expected to witness significant demand growth from Amazon Canada customers for its payment products.
Shares of several payments and fintech stocks struggled to shake off a hangover from the Federal Reserve's September meeting yesterday, in which the Fed delivered another big rate hike. Shares of the large payments rail Mastercard (NYSE: MA) traded nearly 1.5% lower in the final hour of trading today. Shares of the buy now, pay later (BNPL) company Affirm (NASDAQ: AFRM) traded more than 6% lower, and shares of digital bank SoFi (NASDAQ: SOFI) were down nearly 5%.