MarketMoodz
Financials Lead Market With Deep Bench of Near‑Breakouts
Financial stocks sit unusually close to new highs, painting the market’s deepest bench of near‑breakouts. CNBC’s screen found roughly 20 of 76 S&P 500 names within 10% of 52‑week highs were financials, a potential sign that leadership may be broadening beyond AI‑led tech.
Key Takeaways
- CNBC flagged 76 S&P 500 stocks within 10% of 52‑week highs that haven’t made new highs in at least 100 days; about 20 of those are financials.
- Top financial names on the list include JPMorgan Chase (JPM), Fifth Third Bancorp (FITB), U.S. Bancorp (USB), Citizens Financial (CFG), and Bank of America (BAC).
- Insurers on the near‑breakout list include Chubb (CB), Travelers (TRV), Hartford Financial (HIG), and Cincinnati Financial (CINF).
- The Invesco KBW Bank ETF (KBWB) is up more than 8% in June and reportedly hit an all‑time high, returning to its 2011 inception level.
- Bank of America research cites bear‑flattening cycles: in seven such periods since the 1970s, industry net income rose about 7% on average while loan growth accelerated.
People Involved
- Josh BrownCEO, Ritholtz Wealth Management
Entities Involved
- JPMorgan Chase (JPM)Lead bank on the near‑breakout list; reached intraday record highs since early January
- Bank of America (BAC)Top bank on the list; reached intraday record highs since early January; source of research on bear‑flattening cycles
- Fifth Third Bancorp (FITB)Regional bank named among near‑breakouts
- U.S. Bancorp (USB)Regional bank named among near‑breakouts
- Citizens Financial Group (CFG)Bank named among near‑breakouts
- Block, Inc. (SQ)Listed among near‑breakout names
- Chubb (CB)Insurer on the near‑breakout list
- Travelers (TRV)Insurer on the near‑breakout list
- Hartford Financial (HIG)Insurer on the near‑breakout list
- Cincinnati Financial (CINF)Insurer on the near‑breakout list
- Invesco KBW Bank ETF (KBWB)Bank‑sector ETF up >8% in June and cited as hitting an all‑time high
- Ritholtz Wealth ManagementFirm of quoted commentator Josh Brown
- Bank of America ResearchProvider of analysis on bear‑flattening cycles and bank earnings dynamics
MarketMoodz Analysis
A concentration of banks and insurers sitting just below 52‑week highs matters because it signals possible breadth beyond the tech giants that have dominated the rally. If even a subset of those 20 financials breaks out, it would pull leadership away from AI‑heavy names and offer fresh rotation plays for portfolio managers. The recent bounce in the Invesco KBW Bank ETF (KBWB) — up north of 8% in June and cited as hitting a record — underscores that flows are already tilting toward the sector.
Fundamentally, the sector’s momentum is supported by improving capital‑markets activity and a revival in dealmaking, factors that boost fee income and underwriting revenue. Bank of America’s research points to a pattern in bear‑flattening cycles — when long‑term yields fall relative to short rates — that has historically correlated with roughly 7% average industry net‑income growth and accelerated loan growth across seven cycles since the 1970s. That dynamic can expand margins and lift earnings even if the macro picture stays mixed.
What investors should watch next: Fed communications and rate expectations (they drive net interest margins and loan demand), capital‑markets issuance and M&A activity, and technical breadth measures such as new highs versus new lows. Caveat: these findings come from a CNBC screen whose methodology isn’t independently verified here, and specific claims (ETF all‑time highs, intraday records) should be cross‑checked with exchange data and primary research before making trade decisions.
Source: Original Article