Bank Stocks Look Like Trade for Optimists to BofA Merrill

Buying bank stocks is among the “best contrarian risk-on trades” to consider, according to Michael Hartnett, chief investment strategist at Bank of America Corp.’s Merrill Lynch unit. In a report Thursday, Hartnett cited a chart showing U.S. banks bounced off their lowest level relative to the S&P 500 Index since 2011 as sales of new homes climbed to an eight-year high, a signal of faster economic growth. He also recommended U.K. and Japanese stocks, along with technology and industrial shares, as “bull trades of the unexpected.”