Note that the green line (50-day moving average) in the XLF (Financial ETF) chart below has held for 3 weeks:
Taking a close up look, it’s clear the 50-day moving-average has been key support:
Makes you wonder what credit markets know?
Is that $50 differential really pricing in Dodd-Frank easing? And if so, why isn’t credit more excited about the drop in ‘business’ risk?
Leading the XLF lower today are major banking stocks like Wells Fargo (-2%), Bank of America (-1.8%), Citigroup (-1.4%), and JPMorgan Chase (-1.2%). Meanwhile, PNC (-0.20%) and BlackRock (-0.5%) proving relatively immune to the one-day purge.
The Financial Select Sector SPDR Fund (NYSE:XLF) was trading at $23.34 per share on Wednesday morning, down $0.21 (-0.89%). Year-to-date, XLF has gained 0.39%, versus a 2.29% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of ZeroHedge.