Financial stocks fall as Trump's rate cap plan rattles investors

US financial stocks and UK-listed lenders fell on Monday and weighed on global indexes as President Donald Trump's call for a one-year cap on credit card interest rates threatened a key revenue stream for the industry.

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The move amplified concerns over the sector with investors already grappling with interest rate uncertainty and will likely dull the potential benefit from a shift toward value stocks.

Trump on Friday called for a 10% cap on the interest rate starting January 20 without providing details on how he planned to make the companies comply.

Shares of JPMorgan Chase and Bank of America, the top two US lenders, dropped 2.88 and 2.6%, respectively, in premarket trading. Citigroup fell 4.1% while Wells Fargo declined 2.48.

"This rate cap would not address the root of the problem and could push consumers towards more expensive debt. It could push more borrowing away from banks into other unsecured loans such as pawn shops and other non-bank consumer lenders," J.P. Morgan analyst Vivek Juneja wrote in a note.

British bank Barclays' shares touched their lowest in nearly a month and were last down 4.28. The pan-European STOXX 600 index dipped 0.18.

US card operations account for around 11% of Barclays' profits, Hargreaves Lansdown senior equity analyst Matt Britzman said. Credit card lender American Express tumbled 4.7%, while payment processors Visa and Mastercard slipped 1.7% each.

Still, some analysts said imposing a limit on rates would require legislation and could exceed presidential authority.