Bank Stocks Are A Canary In The Coal Mine For The Broader Stock Market
“If there’s one sector of the stock market that trades like death warmed over, it’s the financials. Bank stocks simply can’t get out of their way these days.
Take the KBW Bank Index (BKX) of 24 leading U.S. banks. You can see in this chart that it plunged in April and May, and it hasn’t been able to get off the mat since. In fact, just this week, it’s collapsing to fresh, multi-month lows.”
“Why should you care?
Because the banks are a canary in the coal mine for the broader stock market! The BKX topped out in February 2007 … foretelling the collapse in the Dow and S&P 500 that began several months later. And I believe we’re going to see something similar happen again.
So what’s eating the banks? Plenty!”