The amount of money pouring into financial stocks is baffling. Its important to understand that most funds have these stocks as their largest holdings, as do the major indexes. But as recent as a week ago, the big boys were dumping these stocks so fast it would make your head spin. The money is rotating out of energy stocks and back into financial stocks. It is so hard to trade with this mentality ruling Wall Street. These trends are literally changing by the day. The long term investor is getting whipped. Right now the best thing to do is build your portfolio with solid stocks, and keep away from it as much as you can. These sharp sell-offs and snap-back rallies are awfully tough to take.
Fundamentals have nothing to do with this. It is large funds riding financial stocks for a trade. And what's truly sad is that the government is bailing out these banks, and seeing the stocks climb, thinking their policies are helping. The funds are just using them for a trade. Pure and simple. Don't buy into the hype. That's all I can say.