Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of many of Europe's major banks -- notably in the U.K. and Ireland -- were plunging today, with Allied Irish
So what: On Friday, I noted that Allied Irish's shares were surging after the bank was given a pass in the Euro region's stress tests and was a step closer to another capital injection. However, it's the former issue -- the stress tests -- that seems to be roiling the markets right now. Many investors are concerned that the tests weren't stringent enough and that European banks may be in even worse shape than feared.
Now what: Could this be a buying opportunity for investors with steely nerves? I'm wary of the banks in Ireland -- particularly Allied Irish -- because of the amount of capital that's been injected into them and the extent to which they are wrapped up in politics. In the U.K., though, I think the current valuation on Barclays could provide a decent buying point -- even if the future isn't particularly rosy. Meanwhile, my fellow Fool Anand Chokkavelu is torn -- he thinks the valuations look attractive, but, like many other investors, is wary of trusting the stress-test results.
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