The SPDR S&P Bank ETF (NYSEARCA:KBE) has been red hot since the Nov. 7 presidential election, rising approximately 25% from $35.09 to a recent price of $43.36. Among the reasons given for the euphoric market rise are President-elect Trump's campaign promises to:
- reduce banking regulations
- stimulate the economy via tax reductions plus infrastructure spending, and
- push for normalization of interest rates.
There are three reasons that I expect the bank earnings reports will result in a cooling off of KBE stock price: fundamental, political, and technical. Read more...