- Index hits lowest close since November 2016, down 20% since 2018 high reached in January
- Spanish banks are among the day’s worst sector performers; investors fret about exposure to emerging markets amid rally in dollar, selloff in some EM currencies
- Bankinter -2.6% Banco Santander -2.2%, Banco Sabadell -2.1%
- Spanish banks delivered better loan growth and fee income, mixed net interest margin performance and weaker capital build in 2Q, Goldman Sachs says in a note, trimming estimates for the sector
- Citi strategist Jonathan Stubbs says he’s a contrarian buyer of European banks, arguing that the selloff is “increasingly difficult” to understand unless there is a macro shock or sector earnings shock ahead
- “Banks have reverted to 2018 price-to-books last seen about a year ago at 0.8x. This is presumably an entry point with the promise of a 5.2% (dividend) yield,” AlphaValue analysts wrote in a note this week
- Other movers: Bank of Ireland -3.4%, Deutsche Bank -2.7%, Standard Chartered -2.7%
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