Financial stocks suffered a broad selloff in morning trading Tuesday, as trade-war fears sent the 10-year Treasury yield toward the biggest decline in over three years. The SPDR Financial Select Sector ETF (XLF) slid 2.0%, with 65 of 67 equity components losing ground. That financial ETF (XLF) was the weakest of the ETFs tracking the S&P 500's 11 key sectors. The S&P 500 dropped 1.2%. Among the XLF's most active components, shares of Bank of America Corp. (BAC) lost 2.5%, Citigroup Inc. (C) shed 2.5%, J.P. Morgan Chase & Co. (JPM) gave up 2.1%, Wells Fargo & Co. (WFC) dropped 2.5% and Morgan Stanley (MS) declined 3.1%. The 10-year Treasury yield ( ) fell 13.2 basis points (0.132 percentage points) to 1.704%, putting it on track for the biggest one-day basis-point decline since it fell 16.0 basis points on June 24, 2016, according to FactSet data. The yield decline comes after President Donald Trump said it might be better to hold off a trade deal with China ( ) until after the presidential election. Lower long-term rates can hurt bank earnings, as that could cause the spread between what banks earn from funding longer-term assets, such as loans, with short-term liabilities.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
December 03, 2019 11:38 ET (16:38 GMT)
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