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Friday's Bank Stocks: Surging 2016 market stumbles into 2017

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Friday's Bank Stocks: Surging 2016 market stumbles into 2017

Bank stocks outperformed a broadly lagging market in the last day of trading for 2016, a year that saw markets surge following events like Brexit and the unprecedented victory of Donald Trump in the U.S. election.

The SNL U.S. Bank Index rose 0.33% to 532.65. The Dow Jones Industrial Average fell 0.29% to 19,762.60; the S&P 500 lost 0.46% to 2,238.83; and the Nasdaq composite index decreased 0.90% to 5,383.12.

David Dietze, president and chief investment strategist at Point View Wealth Management, noted that the day's slip in the overall market reflects light trading volume with the holidays. But overall, Dietze said 2016 was a "nice year to put in the books."

The Dow Jones Industrial Average rose 13.4% for the year while the S&P 500 jumped 9.5% and the Nasdaq composite index added 7.5%. Those numbers pale in comparison to bank stocks, with the SNL U.S. Bank Index closing 23.4% higher for the year.

"Financials have led the market since the Trump election and I think probably for good reason," Dietze said. "I think lightening the regulatory burden was a theme of the Trump campaign."

Mitchell Sacks, chief investment officer at Grand Slam Asset Management LLC, said he sees excitement in investors hopeful for a roll-back of Dodd-Frank, which could be "incredibly stimulative for bank earnings and to the economy."

The big four banks saw large growth in their stocks in 2016, with JPMorgan Chase & Co. surging 30.7%, Bank of America Corp. rocketing 31.3% and Citigroup Inc. rising 14.8% for the year. Wells Fargo & Co., which lost its CEO after a fake accounts scandal and then suffered several other missteps, finished the year 1.4% higher.

In trading today, all four banks also inched higher. JPMorgan Chase added 0.47% to $86.29, Bank of America grew 0.45% to $22.10, Citigroup increased 0.08% to $59.43 and Wells Fargo rose 0.49% to $55.11.

Bala Cynwyd, Pa.-based Royal Bancshares of Pennsylvania Inc. rose 6.96% to $4.15 and New Orleans-based First NBC Bank Holding Co. added 5.80% to $7.30. Lebanon, Ohio-based LCNB Corp. lost 5.30% to $23.25 while Baton Rouge, La.-based Investar Holding Corp. fell 4.85% to $18.65.

The SNL U.S. Thrift Index slipped 0.19% to 966.70. New York Community Bancorp Inc. added 0.82% to $15.91.

Market prices and index values are current as of the time of publication and are subject to change.