Reuters alone with market-moving bank sector call

Reuters was alone with news on August 11 that a veteran banking analyst recommended taking short-term profits in U.S. banking stocks. The headlines quoted Rochdale Securities’ Richard Bove saying the banking industry’s fundamentals have not yet improved, US bank earnings will not improve in the third-quarter or even the fourth, and many will instead show losses. Bove’s gloomy outlook pressured U.S. financial stocks, pulling down U.S. markets. The financial sector of the S&P 500 shed 3.5 percent while the KBW Bank Index was down 4.4 percent. The Dow Jones industrial average closed down 1.03 percent, while the S&P 500 Index closed down 1.27 percent. The comments were followed up by stock market reports saying Wall Street was dragged lower by financials, which took a hit after Bove’s bearish comments. Bloomberg and Dow Jones played catch-up with stories later in the day.