End of Year Grind on Light Volume Expected

December 30, 2014
By Vlad Karpel

The small-caps($IWM) are breaking out of what has been in range for the last year. Today, $IWM hit a 52-week high. Some might say this is an index of 2000 stocks – so you take these moves with a grain of salt. I would agree, you need to weed out the sectors that are bubbling up.

The one that is starting to move is small-cap financials. I want to focus on Regional Banks ($KRE), the rising rate in the short end of the curve. Specifically, note the the 2-year bond yields, which is giving some causation for the recent pop in this sector.

I have these names on my radar: Susquehanna Bancshares Inc. ($SUSQ), Western Alliance Bancorp ($WAL), MB Financial Inc. ($MBFI), Bank of the Ozarks Inc.($OZRK), PacWest Bancorp ($PACW), First Republic Bank ($FRC), Popular Inc. ($BPOP), Old National Bancorp ($ONB), East West Bancorp Inc. ($EWBC), and Synovus Financial Corp. ($SNV). These 10 stocks make up about 16 percent of the Regional Banking TF ($KRE) and would be good candidates to start researching for potential trades.

Have a great trading day, and see you next time at the Corner!

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