In addition to the AI boom, stocks have also benefited from a resilient economy, generally strong earnings reports, and inflation falling faster than expected. In addition to the regional banking crisis, the sector was buffeted by rising interest rates, fears of a recession, and expectations of tighter capital requirements. Additionally, economic growth is expected to trough, and the beginnings of a rebound in the economy should support improving valuations in bank stocks as the risk of a recession fades away.