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“On Monday, the question was raised as to whether the 2023 banking crisis was near an end, thanks in part to the largesse of JPMorgan. On Tuesday, Wall Street answered with a Bronx cheer. Investors targeted two more regional banks while taking the broader market down with them. PacWest and Western Alliance led the big selloff in regional lenders as trading in both triggered multiple volatility halts. PacWest fell 28% to close at a record low while Western Alliance tumbled 15%.
“The KBW Regional Banking Index dropped 5.5% on Tuesday, the most since the crisis began back in March. Charles Schwab, a brokerage with a banking arm that’s come under pressure by the recent rout, fell 3.3%. And they weren’t the only victims: Comerica and Zions Bancorp each tumbled more than 10% while Metropolitan Bank Holding dropped 20%.”
Despite its sharp drop, the regional bank KRE is still +54.4% above its pandemic/2020 low. And now we are having a regional banking crisis, but this subsector hasn't yet reached panic-washout stage. I may take a bite at low-30s. https://stockcharts.com/h-sc/ui?s=KRE&p=D&yr=3&mn=6&dy=0&id=p94432364595
Nice chart @Yogibearbull. Yes, KRE bottomed (fell out of bed) in March 2020 along with just about everything else. What I find worth watching for now is whether this trend downward accelerates and, if so, whether it has some spillover effect on monetary / fiscal policy. That, in turn, could change the long-term outlook for many other types of investments going forward.
@hank, Think the collapse of First Republic Bank is the beginning of banking consolidation. The wider implications of credit crunch would be tough for smaller banks (local lending) and their customers. I sold all small and mid caps funds in early March and focus elsewhere.
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https://stockcharts.com/h-sc/ui?s=KRE&p=D&yr=3&mn=6&dy=0&id=p94432364595