Our Outlook for Bank Stocks
Bank stocks go for a wild and divergent ride.
Bank stocks have been on a wild ride of late, which is perhaps the understatement of the year. At the beginning of the third quarter, concerns surrounding the viability of Fannie Mae (FNM) and Freddie Mac (FRE) and what trouble at those two mortgage behemoths might mean for the housing market had investors running from just about every bank stock we follow. After what appeared to be panic selling and flat-out capitulation going into the lows on July 15, investors began differentiating banks by quality of assets, funding sources, and leverage employed.
Matthew Warren does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.
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