If you are bullish on the global economy, reflation, equities making a comeback as an asset class, you hope that the beleaguered financial sector of the equity markets makes a comeback, especially in Europe.
Those hopes have taken a big hit in recent days, as the chart below, the Bloomberg European bank stock index, shows.
Recent history shows us that when peripheral European sovereign debt does poorly, so do bank stocks and so does the euro.
A break below the 79.40 area in the bank stock index could get kinda ugly to the downside as the post-LTRO euphoria fades.
