The market is up. The big banks- -- except Bank of America (NYSE:BAC) -- are down, with Citigroup (NYSE:C) leading the charge. Citi investors can thank, at least in part, the lingering effects of the financial crisis for their bank's depressing performance this week.
Tale of the tickers
First, here's a quick overview of the week:
- Citi is down 1.24%.
- JPMorgan Chase is down 0.53%.
- Wells Fargo is down 1.14%.
- B of A is the trend breaker here, up 1.94% on the week.
The market is running counter to a generally down week for the big banks, too, with the Dow Jones Industrial Average up 0.58%, the S&P 500 up 0.59%, and the Nasdaq up 0.70%.
The gift that keeps on giving
The big news for Citi this week was that the superbank settled a $730-million investor lawsuit for "misstatements and omissions in the company's disclosures" for shares purchased between May 11, 2006 and November 28, 2008.
Is this amount in any way a danger to the country's third-largest bank? Of course not, but things like this always put investors on edge, especially when it involves leftover financial-crash business. Even though four-plus years have passed since the start of the Great Recession, many of the country's biggest banks are still feeling the aftershocks.
Everyone knows that Citi still has a "bad bank" on the books, designed specifically to deal with the toxic-mortgage debt it accumulated during the housing boom. And B of A just agreed to pay Fannie Mae $10 billion this past January for bad mortgages it sold to the government-run housing giant.
Foolish bottom line
Nobody knows exactly when these aftershocks are going to end. We all know how long legal entanglements can take to get sorted out. Of course, this lawsuit settlement may have nothing whatsoever to do with Citi's downward ride this week.
The great invisible hand of the market can sometimes act with utter randomness and caprice. But, as Foolish investors -- in it for the long-term -- we know we have to ride out the spikes and plummets and keep our eyes focused far down the road. So long as the companies you're invested in have strong fundamentals, your money is in the right place.