XLF: How Did Its Subsectors Perform Last Week?



Which financial stocks lost the most?

Since the beginning of the year, global stock markets have been on a roller-coaster ride of slowing economic growth and plunging oil prices. The financial sector, a leading indicator of market decline, has been most affected by this global sell-off. However, the losses incurred at the beginning of the year were offset by gains in March. The Financial Select Sector SPDR ETF (XLF) closed at $22.05 on April 8, falling 2.9% during the week. In comparison, the Vanguard Financials ETF (VFH) and the iShares US Financials ETF (IYF) generated negative returns of 2.2% and 2.6%, respectively, during the same period.

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Banks and diversified financials impacted

While most subgroups within the financial sector generated negative returns last week, banks and diversified financials lost the most. Diversified financial services stocks included within the XLF portfolio lost 4% last week and banks lost 3.8%. Investment banks led losses within the subgroup and fell by 6.7% last week.

Among the 15 diversified financial services stocks, 14 posted negative returns during the week, led by Legg Mason (LM), CME Group (CME), and E*TRADE Financial (ETFC). These stocks fell by 9%, 8.1%, and 7%, respectively.

However, analysts are bullish on diversified financial stocks for the next 12 months. Read on to understand analysts’ views on these stocks.


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