Financial stocks have done this only 3 other times
Financials have been on a heckuva run. So much so that more than half of them hit a 52-week high on Thursday.
Stocks like KeyCorp, Progressive, and Capital One have surged in recent weeks after a brief consolidation. Even with a breather on Friday, more Financials hit 52-week highs than stocks in any other major sector.
There were 3 other similar thrusts in Financial stocks hitting 52-week highs in recent months. Over the past 50 sessions, an average day has seen nearly 20% of Financial stocks hitting new highs. This is one of the highest averages in more than 20 years.
Our Backtest Engine shows that there were 3 other distinct times in the past 20 years when financials went on a run like this, with nearly 20% of Financials hitting a 52-week high on an average day over 50 sessions.
Even when looking at lesser extremes in this 50-day average of new highs in XLF, the fund struggled to show sustained gains over the next several months.
| Stat Box Last week, large speculators (typically hedge funds) in major index futures like the S&P 500 and Nasdaq 100 bought more than $20 billion worth of contracts. That's the 5th-largest one-week net purchase in the history of the contracts. |
What else we're looking at
- More detailed returns after Financials see a run in 52-week highs
- An update to the Market Breadth Composite and what it's saying about stocks' health
- What to watch for when a large number of stocks in the S&P 1500 become oversold