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Regional bank stocks have underperformed the S&P 500 by around 30% year to date. However, the group has been charging ahead of the large-cap index by 18% over the past month as investors bet on a post election stimulus approval to increase spending.

Regardless of the outcome of the election, investors are hoping Congress will finally turn their attention to passing a stimulus bill, increasing consumer spending, and potentially benefiting banks with a domestic focus.

Highlights

• Regional bank stocks outpaced the S&P 500 by 18% over the past month as investors bet on higher stimulus spending post-election.
• Huntington Bancshares Incorporated (HBAN) stock broke above a 10-month downtrend line and the 200-day simple moving average (SMA) in October before successfully retesting and defending the breakout level.
• Bulls pounced on a buy-the-dip opportunity in SVB Financial Group (SIVB) when the price retraced to the closely watched pre-COVID February high

Biden and Trump called for more stimulus to help American can families and businesses

While Democratic nominee, former Vice President Joe Biden has not committed to a specific stimulus plan, his website does call for more direct payments, additional money for small business, student loan relief, introduces emergency paid sick leave for all, and increased unemployment benefits.

President Donald TrumpTrump has also called for more direct payments in the next stimulus plan. With both cadidates pro-direct payments, investors just need congress to come to an agreement. With the election behind them, this should be a primary focus of theirs.

Below, aret two prominent regional banking stocks worth watching this week that reflect the trend covered earlier in this article.

Huntington Bancshares Incorporated (HBAN)

This Columbus, Ohio based bank provides consumer, small business, commercial, asset management, brokerage, trust, and insurance services to customers across eight Midwestern states.

Huntington Bancshares reported third quarter adjusted earnings of 27 cents per share, beating the 25-cent per-share estimate analysts had expected thanks to higher net interest income. But the bottom line contracted 21% year over year due to increased credit provisions.

Huntington's mortgage business should continue to provide support during the current housing market boom going forward though. As of Nov. 2, 2020, the company has a $10.62 billion market capitalization, offers a generous 5.75% dividend yield, and is trading 13.85% higher over the past month.

Huntington shares broke above a 10-month downtrend line and the 200-day SMA in October before retesting and maintaining the breakout level last week. Additionally, the 50-day SMA continues to move toward the 200-day SMA and may form what's known as a "golden cross" buy signal later this month.

SVB Financial Group (SIVB)

SVB Financial operates as a diversified financial services company. It provides numerous banking and financial products and services through four segments. Those segments are Global Commercial Bank, SVB Private Bank, SVB Capital, and SVB Leerink.

The $15.06 billion bank headquartered in Santa Clara, California posted third quarter earnings of $8.47 per share and revenues of $1.08 billion. Both the top and bottom lines growing 32% and 64.5% respectively from the previous year due to rising loan and deposit balances.

Although classified as a regional bank, SVB Financial also operates in the United Kingdom, Israel, China, and India to help diversify risk globally. Trading at $290.70, SVB stock has returned over 20% in the past month and 15.8% on the year as of Nov. 2, 2020.

After bottoming out in mid-March the stock has been steadily climbing back. Like with Huntington above, Bulls pounced on a buy-the-dip opportunity last week when SIVB's price retreated to the pre-COVID February high that now serves as a crucial support area.