Slumping large-capitalization financial stocks were led lower by sliding regional banks Thursday amid disappointing U.S. economic data and worries about a sputtering global recovery.
All the top ten decliners were regional banks, with Huntington Bancshares Inc. (HBAN 5.38, -0.16, -2.89%) , KeyCorp (KEY 7.33, -0.37, -4.75%) , and Regions Financial Corp. (RF 6.32, -0.26, -3.95%) down the most, falling about 4% to 5%.
Bank of America Corp. (BAC 13.79, -0.58, -4.04%) was the worst performer of the largest
The Financial Select Sector SPDR exchange-traded fund (XLF 13.48, -0.33, -2.37%) , which tracks the financial stocks in the S&P 500 Index (SPX 1,017, -13.41, -1.30%) , was down about 2%.
Financials started out largely neutral after the U.S. Labor Department on Thursday morning said weekly jobless claims rose 13,000 to 472,000, compared to economist estimates of 455,000 claims this week. This followed weaker-than-expected private sector employment report from ADP released Wednesday. Republicans in the Senate also filibustered a bill Wednesday night that would allow for an extension of unemployment benefits. Read about the jobless report here
Losses in the broader market mounted after the Institute for Supply Management manufacturing index fell more than expected and a report showed pending sales of existing homes tumbled by almost a third from last month, the biggest drop since 2001. Read about the manufacturing report here.
M&T Bank Corp. (MTB 86.14, +1.19, +1.40%) and Goldman Sachs Group Inc. (GS 131.19, -0.08, -0.06%) were among the more moderate decliners, staying roughly flat. Research firm Collins Stewart wrote in a note released Thursday it is "increasingly more constructive" on M&T Bank, repeating its hold rating.
Shares of Citigroup Inc. (C 3.71, -0.05, -1.33%) were down about 1%. The Treasury Department said premarket Thursday it has sold about 1.1 billion more shares of Citi, bringing to total to about 2.6 billion shares sold, or a third of the total 7.7 billion shares the government took in return for assistance.
The House of Representatives approved the financial-legislation bill on 237-192 vote late Wednesday with almost no Republican support. While a Senate vote isn't expected until the week of July 12, the bill is unlikely to change. Read more about the bank bill here.
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