Shares of bank and other financial stocks suffered broad declines in premarket trading Thursday, after the restart of quantitative easing by the European Central Bank sent U.S. Treasury yields sliding. The SPDR Financial Select Sector ETF /zigman2/quotes/209660484/composite XLF -1.14% fell 0.8% in premarket trading. Among the more active components, shares of Bank of America Corp. /zigman2/quotes/200894270/composite BAC -2.98% fell 1.2%, Citigroup Inc. /zigman2/quotes/207741460/composite C -2.54% shed 1.2%, J.P. Morgan Chase & Co. /zigman2/quotes/205971034/composite JPM -2.55% lost 1.0%, Wells Fargo & Co. /zigman2/quotes/203790192/composite WFC -2.76% declined 0.8% and Goldman Sachs Group Inc. /zigman2/quotes/209237603/composite GS -1.74% gave up 0.7%. After the ECB's moves, the yield on the 10-year Treasury note declined 6.2 basis points to 1.671%. Lower longer-term yields can hurt bank profits, as it narrows the spread between what banks earn on longer-term assets, such as loans, that are funded with shorter-term liabilities. The financial ETF has gained 18.1% year to date through Wednesday while the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.07% has rallied 16.3%.
Read the full story:
Dow logs 7th gain in a row on renewed trade optimism, ECB stimulus