The financial sector, as measured by the XLF ETF, is trading sharply higher, up over 1.5% in the current session. This move appears to be driven by macroeconomic factors, primarily the re-escalation of U.S.-Iran tensions which is fueling a rally in oil and gas prices. This has led to increased inflation expectations and a higher probability of central bank rate hikes, which can benefit bank profitability by widening net interest margins. An ADP report showing a slip in August employment is also being digested by the market.
Financial Sector Surges on Rate Hike Speculation
Financials sector
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