Santander’s problems have been largely as a result of the financial crisis in the Eurozone, with the bank’s primary markets in Spain and Portugal. The debt crisis has resulted in an exponential rise in non- performing loans, specifically in Spain where Santander has an 8.93% exposure. On top of this, Santander has been exposed to the underperforming and risky Latin American market, which has been heavily hit by the drop in commodities prices. The banking industry, as a whole, has been struggling for most of 2015. This struggle is likely to continue, with many central banks embarking on market stability measures to stimulate growth and reduce risk; resulting in regulatory reform and subsequent loss of profitability for banks. These fundamentals highlight investment opportunities in Santander stock options.
Investors Notes:
- The stock appears to be in a consolidation period in the middle of an extended descending channel which started back in September 2014.
- Bearish momentum has been confirmed in MACD with a significant break of support level, with indications of the short- term recovery coming to an end.
- On RSI indicator, momentum has hit resistance and bounced back off the midline several times in recent months, as buyers struggle to overcome downward trend.
- Banc De Binary Analysts predict there will be further downward momentum over the next three months.