Synchrony Financial Plummets 6.75% Amid AI-Driven Job Cut Fears – What’s Next for the Financial Sector?

Summary
• Synchrony Financial (SYF) gaps down to $69.49, trading at $68.98—a 6.75% drop from its previous close of $73.98.
• Block’s AI-driven workforce reduction sparks sector-wide panic, dragging down credit card peers like American Express (-7.78%) and Capital One.
• SYF’s 52-week range (40.55–88.77) and 6.91x dynamic P/E highlight its value proposition amid the selloff.

Today’s sharp decline in Synchrony Financial reflects a broader market reaction to AI-driven job cut fears, with the stock trading near its 200-day moving average of $72.48. The move underscores growing investor anxiety over AI’s impact on employment and credit-sensitive industries.

AI-Driven Job Cuts Spark Sector-Wide Sell-Off
Synchrony Financial’s 6.75% intraday drop follows Block’s announcement of AI-driven workforce reductions, triggering fears of widespread job losses in the financial sector. Investors are extrapolating this to credit card companies, which rely on stable employment for consumer spending. The sell-off mirrors a similar panic in January 2026 over credit card interest rate caps, where SYF fell 8.1% on regulatory concerns. While SYF’s partnership with Polaris to boost powersports financing offers a long-term growth tailwind, the immediate trigger is the sector’s vulnerability to macroeconomic shifts tied to AI adoption.

Diversified Financial Services Sector Under Pressure as AXP Follows SYF Downward
Synchrony Financial’s 6.75% decline aligns with broader sector weakness, as American Express (AXP) fell 7.78% in the same session. Both stocks are part of the Diversified Financial Services sector, which is grappling with AI-driven employment risks and regulatory headwinds. The sector’s underperformance highlights its reliance on consumer spending stability, making it particularly sensitive to macroeconomic shifts. While SYF’s 21.9% annual gain outperforms the sector’s 18% decline, today’s selloff suggests renewed caution.

Options Playbook: Capitalizing on Volatility with High-Leverage Puts
• MACD: -1.51 (bearish divergence from signal line -1.84)
• RSI: 49.97 (neutral, but trending downward)
• Bollinger Bands: Price at $68.98 (near lower band at $69.88)
• 200D MA: $72.48 (price testing key support)

SYF’s technicals suggest a short-term bearish setup, with the 200-day moving average acting as resistance. The stock is trading near its lower Bollinger Band, indicating oversold conditions. A breakdown below $68.44 (intraday low) could trigger further selling. For leveraged exposure, consider the following options:

• SYF20260320P65
- Type: Put
- Strike: $65
- Expiry: 2026-03-20
- IV: 45.64% (moderate)
- Leverage: 49.23%
- Delta: -0.2769 (moderate sensitivity)
- Theta: -0.03595 (time decay)
- Gamma: 0.0433 (price sensitivity)
- Turnover: $28,807
- Payoff at 5% downside ($65.53): $0.53/share (106% return on premium).
- This put offers high leverage and liquidity, ideal for a 5% downside scenario.

• SYF20260320P67.5
- Type: Put
- Strike: $67.5
- Expiry: 2026-03-20
- IV: 44.18% (moderate)
- Leverage: 30.63%
- Delta: -0.3974 (strong sensitivity)
- Theta: -0.03235 (time decay)
- Gamma: 0.0516 (price sensitivity)
- Turnover: $12,567
- Payoff at 5% downside ($65.53): $1.97/share (315% return on premium).
- This contract balances leverage and gamma, offering outsized returns if SYF breaks below $67.50.

Aggressive bears should target SYF20260320P67.5 if the stock closes below $68.44.

Backtest Synchrony Financial Stock Performance
The performance of SYF (Safin Hossain) following a -7% intraday plunge from 2022 to the present has been backtested. The results show a positive trend, with the 3-Day win rate at 56.51%, the 10-Day win rate at 56.72%, and the 30-Day win rate at 57.56%. The maximum return during the backtest was 5.61% over 30 days, indicating that SYF has a higher probability of positive returns in the short term after a significant pullback.

Act Now: Position for a Potential Sector Correction as AXP Slides 7.78%
SYF’s 6.75% drop reflects a broader sector selloff driven by AI-driven job cut fears, with American Express (AXP) falling 7.78% as a sector leader. While SYF’s long-term fundamentals remain intact—bolstered by its Polaris partnership and 15.2% net interest margin—the immediate outlook is bearish. Key levels to watch include the 200-day MA at $72.48 and the lower Bollinger Band at $69.88. For traders, the SYF20260320P67.5 put offers a high-leverage play on a potential 5% downside. Position now for a sector correction, and monitor AXP’s trajectory as a barometer for financial sector sentiment.