🏦 European Banks > American Banks

Plus, a Chinese billionaire is the second-biggest foreign owner of US land.

Happy Tuesday afternoon to everyone on The Street. Here's a snapshot of where markets ended the trading session, plus tomorrow's trade idea delivered to you today.

  • 🟨 | US stocks were mixed Tuesday. The broad market S&P 500 index closed lower by 0.15%. The Dow fell 0.42%, while the Nasdaq Composite recovered from earlier today to gain just 0.09%.

  • 📈 | One Notable GainerJuniper Network's stock surged over 22% on reports of a potential $13 billion acquisition by Hewlett Packard.

  • 📉 | One Notable DeclinerJetBlue's stock declined over 10% after a Bank of America downgrade from neutral to underweight, amid concerns over the domestic airline industry's prospects.

  •  🇪🇺 | Tomorrow's TradeBetting On European Banks. Scroll down for more.

🚨 Also, just in from CNBC: “The Securities and Exchange Commission has approved rule change applications to allow the first bitcoin ETFs in the United States, paving the way for the long-awaited funds to begin trading as soon as this week.”

Plus: looking to diversify your portfolio and safeguard your retirement? Today’s partner can help.


Which AI adopter stock do you think will outperform in 2024?

🟩🟩🟩🟩🟩🟩 American Express (AXP)

🟨🟨🟨⬜️⬜️⬜️ Sony Group (SONY)

🟨⬜️⬜️⬜️⬜️⬜️ Wells Fargo (WFC)

🟨🟨🟨🟨⬜️⬜️ JPMorgan Chase (JPM)

S&P 500 Heatmap. Credit: Finviz.

All stocks listed on US stock exchanges. Credit: Finviz.

Foreign ADR stocks on NYSE, NASDAQ, AMEX. Credit: Finviz.


U: Unity Software's stock dipped 8% after it announced yesterday it’s cutting 25% of its workforce, about 1,800 jobs, in a restructuring initiative.

MTCH: Match Group's shares rose 3% following a Wall Street Journal report that Elliott Investment Management acquired a stake worth around $1 billion in the dating app company.

ILMN: Illumina's shares surged over 4% after the biotech company forecasted fourth-quarter revenue surpassing analysts' expectations.

CRWD: CrowdStrike's stock rose under 5% after Morgan Stanley upgraded it to overweight, citing promising product cycles and its new AI platform as key factors.

HPE: Hewlett Packard Enterprise's stock dropped 9% amid reports that it is close to acquiring hardware company Juniper Network, as reported by The Wall Street Journal.


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Forbes: X, the social media site formerly known as Twitter, announced it would begin rolling out a peer-to-peer payment service similar to Venmo or PayPal this year.

Bespoke: 18 stocks are already up at least 5% YTD, but 27 stocks are already down 5% on the year. One-third (9) of the stocks listed are all from the Tech sector and more specifically, most of them are from the semiconductor group.

BBG: Invesco, Bitwise, Valkyrie and WisdomTree lowered fees in their spot Bitcoin ETF applications, according to updated filings with the US Securities and Exchange Commission. Bitwise, which already had the lowest final fee of 24 basis points, dropped it even lower to just 20 basis points in Tuesday’s filing.

Market Watch: The Nikkei 225 ended Tuesday at its highest level in 33 years, continuing a hot streak for Japanese equities amid signs the country is exiting deflation and its companies are making corporate governance reforms.

Fox Business: Jamie Dimon is 'skeptical' of an economic 'Goldilocks scenario'.


Make It Real Eu Flag GIF by European Commission

European Banking Resurgence

2024 is poised to be a pivotal year for European banks. In fact, they're projected to outperform their American counterparts quite significantly.

Last year, for example, analysts slashed their 2024 profit forecasts for US banks by 16%. Meanwhile, big European banks' earnings projections received a 37% increase. 

Moreover, many experts who follow the sector think European banks are simply undervalued.

Mind the Gap

The KBW Index, which tracks the top 24 US banks, saw an impressive 30% jump during the final two months of 2023. That run was short-lived, however, as debt and regulatory concerns weighed on Wall Street’s minds. 

Currently, that same index is expected to see a return of under 1% in 2024. No bueno. Meanwhile, Europe’s Stoxx 600 Bank index is projected to see around a 22% gain.  

This staggering 21% spread represents the most substantial variance in start-of-year return estimations for the two indexes since 2005.

Popping The Hood

The Stoxx 600 index comprises 46 banks, with projections indicating that 32 of them will realize double-digit stock returns this year. Notably, only one stock in the index is anticipated to yield a return of less than 10%.

Conversely, American banks are grappling with sluggish demand for new loans and are still recovering from last year's regional banking crisis, underscored by the fall of SVB. 

Zooming out, it hasn’t always been this way. Over the past decade, the US KBW Index has generated a 5.3% return on average. Europe’s Stoxx 600 annualized return came in at 0.2% over the same time period. 

While Fed rate cuts may offer some relief, analysts posit that the real value lies across the pond this year. We’ll get our first hint at whether or not these analyst predictions hold water when JPMorgan, Bank of America, Citigroup, and Wells Fargo report earnings this Friday.

Which index is going to outperform this year?

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Interest rates are at 22-year highs, but you can take advantage of them. With rates hovering around 5%, high-yield savings accounts present an opportunity for substantial returns through compound interest.

Offering up to 10 times the return compared to regular savings accounts, these accounts are ideal for short- and long-term goals.


Calculated Risk: Since December 2021, used-vehicle values are down nearly 21%.

BI/YouGov: Just 39% of Gen Z said advancing their education is important to them. 46% of them said they don't think college is worth the cost.

BBG: An iPhone that had been sucked out of the Boeing Co. 737 Max 9 jet’s cabin remained in functioning condition after a 16,000-foot tumble.

Zero Hedge: According to the ‘Vision Atlas’ report by the International Agency for the Prevention of Blindness (IAPB), vision loss is predicted to increase by as much as 55 percent in the next 30 years, impacting some 600 million new people.

BBG: A Chinese billionaire is the second-biggest foreign owner of US land.

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