Large Cap Banks:Sharp Run Post Elections -Need More Details For Next Leg Up;Dodd Frank?

Bank stocks are up sharply since the elections, led by expectations for more Fed hikesand steeper yield curve, growth from fiscal stimulus, and lower regulations. Bankstocks are trading close to relative P/E multiples (to S&P 500) highs reached in the lasttightening cycle but these are based on current EPS estimates - if estimates go up,relative P/E multiples will be lower and it would drive further upside to the sector.

    However, rate hikes need to be above current expectations. In addition, there are nodetails yet on fiscal stimulus or pull back of regulations