Stalled Rates Leave U.S. Financial Stocks Out on a Limb
U.S. financial stocks lost “a strong tailwind” from rising interest rates, according to David Kastner, a senior investment strategist at the Schwab Center for Financial Research. Kastner compared the industry group’s relative strength within the S&P 500 Index and the yield on 10-year Treasury notes in a report Sunday. The ratio between the S&P 500 Financial Index and the U.S. equity benchmark climbed as much as 9% through last week from an April 20 low, according to data compiled by Bloomberg, while the 10-year yield was little changed. Kastner cut his rating on financials to marketperform from outperform.