US stocks fall on weak bank earnings
Wall Street stocks Thursday fell for a fifth straight day following disappointing US bank earnings and a surprise move by the Swiss central bank to strengthen its currency.
NEW YORK–Wall Street stocks Thursday fell for a fifth straight day following disappointing US bank earnings and a surprise move by the Swiss central bank to strengthen its currency.
The Dow Jones Industrial Average fell 106.38 points (0.61 percent) to 17,320.71.
The broad-based S&P 500 dropped 18.60 (0.92 percent) to 1,992.67, while the tech-rich Nasdaq Composite Index slumped 68.50 (1.48 percent) to 4,570.82.
US quarterly bank earnings continued to disappoint, with Bank of America net income dropping 11.3 percent and Citigroup profits sinking 86 percent on a hefty legal charge.
Bank of America shares plummeted 5.2 percent, while Citi shares dropped 3.7 percent.
Article continues after this advertisementEquity markets in Britain, France and Germany all gained at least 1.7 percent after Switzerland’s central bank scrapped a policy to artificially hold down the value of the Swiss franc against the euro.
Article continues after this advertisementThe Swiss move and the ensuing drop in the euro is “perceived to be an economic benefit” to Europe because a cheaper currency benefits manufacturing exports, said Chris Low, chief economist at FTN Financial.
A renewed steep fall in crude-oil prices, with the US contract down four percent, also weighed on market sentiment.
Dow member JPMorgan Chase, which released disappointing earnings Wednesday, fell 3.2 percent. Investment banks Goldman Sachs and Morgan Stanley dropped 1.8 percent and 1.0 percent, respectively.
Some leading technology equities suffered deep declines, including Apple (-2.7 percent), Alibaba (-3.3 percent), Facebook (-2.9 percent) and Priceline (-3.6 percent).
US clothing and home goods retailer Target advanced 1.8 percent after it announced it was pulling out of Canada following a disappointing launch. Target said fourth-quarter comparable US sales rose about three percent, better than the two percent previously projected.
Best Buy plummeted 14.1 percent as it warned that deflationary pricing and weak industry demand in some categories would challenge results in coming quarters. The electronics retailer said domestic comparable sales rose 2.6 percent in the holiday shopping period.
BlackBerry sank 20.2 percent after it quashed a report that said it had been approached by Samsung for a possible takeover. The report had sparked a big rally in BlackBerry shares late Wednesday.
Bond prices jumped. The yield on the 10-year US Treasury fell to 1.74 percent from 1.85 percent Wednesday, while the 30-year dropped from 2.46 percent to 2.38 percent, a new all-time low. Bond prices and yields move inversely.
