Citigroup downgraded OCBC to Sell with a $27.50 target price, expecting flat Q3 earnings; the stock fell 5.9% on Wednesday. The Straits Times Index (STI) dropped ~2.5% to around 5,466 this morning, with OCBC falling another 4.4%, UOB 4.8%, and DBS 3.2%.
A sharp decline in the three major bank stocks is not inevitable; I view this as a normal correction and see no need for panic. If capital can withstand it, now is an excellent time to adjust positions.
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