Bad News Banks Breaking Training

 | Nov 15, 2013 | 11:07 AM EST  | Comments
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Stock quotes in this article:

wfc

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jpm

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c

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bac

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key

It's been a long time since the banks have been able to shake off bad news and go higher. Today's one of those days.

They got these ridiculous Moody's downgrades and, at last, they meant nothing. You have the Attorney General of the United States talking about coming down on the currency manipulators, which could lead to all new investigations of money centers -- will they ever cease? -- and they meant nothing.

These stocks are all trading higher, in part, I think, because we are going to get a little inflection in the yield curve and in part because they are just too cheap relative to other stocks. It's very in vogue to talk about bubbles, but is it a bubble to mention that Bank of America (BAC) isn't back to where it was in May 2010? Isn't that a little nuts? How about Citigroup (C) unable to take out its 2009 top?

So, when I look at this group I can truly say it is a bargain vs. other times and  that's spurring real interest.

This group can provide fabulous leadership and it has been through hell and back. If they catch fire, then many more can catch fire, too. We are holding on to Wells Fargo (WFC) for Action Alerts PLUS and would buy more JPMorgan Chase (JPM) if it would come down. Meanwhile, there is some research on KeyCorp (KEY) raising the price target to $15. Seems like a reasonable stretch given the turn we are seeing in bad loans, in the yield curve and the return of growth in the Midwest.

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