Bank stocks took a broad beating Tuesday, as the tumble in 10-year Treasury yields (Bank of America Corp. (BAC) dropped 2.6%, Citigroup Inc. (C) gave up 2.0%, Wells Fargo & Co. (WFC) lost 1.3%, J.P Morgan Chase & Co. (JPM) declined 1.5%, Huntington Bancshares Inc. (HBAN) fell 2.9% and Regions Financial Corp. (RF) dropped 2.7%. The 10-year Treasury yield declined 6.7 basis points to 1.439%, the lowest yield seen since July 2016. Lower longer-term yields can pressure bank profits, as it narrows the spread banks earn by usual practice of funding longer-term assets, such as loans, with shorter-term liabilities. The bank ETF (KBE) has now shed 18.9% over the past 12 months, while the 10-year yield has been cut in half and the Dow Jones Industrial Average has edged up 0.5%.) to a fresh three-year low following disappointing manufacturing data ( ) cast a pall on the financial sector. The SPDR S&P Bank ETF (KBE) slid 2.1% with 87 of 90 equity components losing ground, while the SPDR S&P Regional Bank ETF (KRE) shed 2.3% with all 122 components falling. Meanwhile, the SPDR Financial Select Sector ETF (XLF) dropped 1.3% with 58 of 68 components declining, but 7 of the gainers were insurance companies, 2 were trading platforms and 1 was a credit rating agency. Of the more-active banks, shares of
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
September 03, 2019 11:54 ET (15:54 GMT)
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