Bank stocks look to escape U.S. financial-crisis legacy

U.S. bank stocks are finally poised to put a legacy of the 2008 financial crisis behind them. The KBW Bank Index on Wednesday came within 1.1% of breaking a record set in February 2007, before a housing-market collapse touched off the crisis, according to data compiled by Bloomberg. The industry gauge has risen 22.5% in February, which would be its biggest-ever monthly gain, and has more than doubled since falling to an almost seven-year low in March. To be sure, banks are among the past 14 years’ worst performers in the S&P 500 Index, which rose 169% through Wednesday from its level at the KBW index’s peak.

Crisis-era weakness among U.S. bank stocks is back again

U.S. banks are worse off than they were after the 2008 financial crisis, judging by their stock performance. The ratio between the KBW Bank Index and the S&P 500 Index fell Monday to its lowest level since at least 1992, according to data compiled by Bloomberg. The previous record was set on March 6, 2009, at the end of a bear market tied to the crisis. “Banks are now our biggest concern,” Jonathan Krinsky, chief market technician at Bay Crest Partners LLC, wrote Friday in a report that cited the ratio.

Time for financial stocks to be leaders for a change

Financial stocks are poised to become market leaders once bond yields rise, according to Tobias Levkovich, Citigroup Inc.’s chief U.S. equity strategist. They haven’t been in that position since the 2008 financial crisis, as reflected in the ratio between the S&P 500 Financial Index and the S&P 500. Levkovich cited the indicator in a report Friday, in which he wrote that yields are the key because they are “so crucial for bank stocks.”

5 years later (Nov 2022)