Is no one concerned about the Bank Stocks?
Sure I get that the Tesla (TSLA) news after hours was a big deal but to spend two hours of television time discussing one stock that trades barely 10 million shares a day and ignore the move in the bank stocks seems, well, a bit ridiculous. Heck, Bank of America (BAC) trades 55 million shares a day, so perhaps I am silly to think that BAC and its friends are a bit more important to the overall market than TSLA is.
I have not been a fan of the banks for a while (as I'm sure you know). First I think there has not been enough "give up" in the group. It seems too many still recommend "financials." And I'll be honest, I still don't understand why for most of my career lower rates were good for banks but now higher rates are supposed to be good for them.
And yet, interest rates have spurted upward in September but the Bank Index is down 5%. Heck, it's 5% in just the past week. And no one is fussing!
The Bank Index is nearing some support as it closes in on $104-$105 so I would be surprised if it doesn't see some sort of oversold bounce from there.
Lest you think the Regional Banks are doing better than the Money Centers, nope, they are a different chart picture but clearly not better. (KRE) , an ETF to be long the Regional Banks, broke the uptrend line two days ago. KRE is down almost 10% since June. Yet no one fusses.
KRE is coming into some support in the $58-$59 area but where is that bounce going? To resistance at $61?
Clearly I am ridiculous for thinking the banks are more important than Telsa.
Away from that Thursday's action was more of the same sloppy action we've seen. Breadth was poor. And we can't even blame the bonds since they were flat on the day. Nasdaq was up 50 points and net volume was +240 million shares. Wednesday's move in Nasdaq of down 17 points saw net volume lose 380 million shares so over two days there is a loss of 140 million shares and a gain of just over 30 points in the index. That's narrow by any measure.
Well, at least all this sloppy action is pushing the market closer to an oversold condition than it was earlier in the week.