Financials Lagging — Again

After outperforming the S&P 500 index for seven months, the financials have recently lost ground. Since mid-October, the sector has underperformed the broad market by more than 10%.

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Based on recent history, that divergence could be (another) sign of trouble ahead for the overall market. Perhaps that’s one reason why firms like Wells Fargo and Citigroup have just announced major cash calls?

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