MARKET TALK: Banks Continue Their Advance; A Change In Trend?

0959 GMT [Dow Jones] The Stoxx Europe 600 banks index +0.6% at 226.78, having added around 7.5% of gains since the release of the EU-wide stress tests and the relaxation of the Basel III capital requirements. After years of underperformance, and with most investors (apparently) still underweight, a relaxation of capital and funding concerns, combined with successful (albeit too soft) Stress Tests, could mark the change in the trend, says Evolution Securities. "This could be the turning point for many fund managers to finally consider rebuilding their bank positions," it adds. "We remain positive on pure fundamentals as we expect the sector return on risk weighted assets to keep improving in 2011-2012 and beyond," adds Evolution. (ishaq.siddiqi@dowjones.com) Contact us in London. +44-20-7842-9464 Markettalk.eu@dowjones.com (END) Dow Jones Newswires July 28, 2010 05:59 ET (09:59 GMT)