7 Major Banks to Avoid Right Now

In the wake of the Brexit vote, bond yields around the world are collapsing. The U.S. 10-year Treasury note dropped to a record low of 1.318% yesterday, while Switzerland’s 50-year bond fell below 0% for the first time ever. The Japanese and German bonds are also now in negative territory. And British 10-year bonds slipped to a record low of 0.723%. As a result, yields curves around the world are flattening.

I should also add that last week, Bank of England Governor Mark Carney stated that the Brexit vote could impact the British economy. He noted that the British Central Bank may need to further ease its monetary policy and slash key interest rates. His comments further undermined the British pound, which is sitting at fresh lows of around $1.30 versus the U.S. dollar, and raised more currency concerns.

With negative interest rates spreading and mounting concerns about potential currency losses, many major banks are haunted by rumors that they may have major losses. And that is on top of flattening yield curves that are already crushing big bank and financial stocks.

In this environment, steering clear of major financial institutions is probably a good course of action. According to Portfolio Grader, there are seven major banks to receive a “strong sell” rating right now.

Symbol Company Name Quantitative Grade Fundamental Grade Total Grade
HSBC HSBC Holdings plc Sponsored ADR
F
C
F
BCS Barclays PLC Sponsored ADR
F
D
F
BBVA Banco Bilbao Vizcaya Argentaria, S.A. Sponsored ADR
F
C
F
SMFG Sumitomo Mitsui Financial Group, Inc. Sponsored ADR
F
C
F
RBS Royal Bank of Scotland Group plc Sponsored ADR
F
D
F
SAN Banco Santander S.A. Sponsored ADR
F
C
F
LYG Lloyds Banking Group plc Sponsored ADR
F
D
F

To see how other financial institutions and banks are faring right now, consider checking out their Portfolio Grader ratings.

Sincerely,

Louis Navellier

Louis Navellier

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