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Tuesday's Bank Stocks: Banks fall amid broader slump; First NBC shares plummet

U.S bank stocks slid to a lower close for the second consecutive session, as broader markets were mixed, during trading Tuesday, Jan. 31.

The SNL U.S. Bank index dropped 0.59% to 529.67, and the SNL U.S. Thrift index edged up 0.10% to 938.81.

Broader markets continued a sell-off that started during Monday's session after President Donald Trump's Jan. 27 executive order which temporarily banned citizens of seven foreign nations from traveling to the U.S. Wider markets opened lower again and spent the day in negative territory; both the S&P 500 and Dow Jones Industrial Average closed with losses.

The consecutive days of market losses are part of an ongoing re-evaluation of just how much of his economic agenda Trump will be able to implement, as well as the impact of those policies, according to FTN Financial economist Jay Morelock. "Heading into the year, the markets had priced in a full-steam-ahead economy with a range of stimulative policies from the Trump administration to push GDP growth to 3% or 4%," Morelock said, though he added that in recent days "that is being tempered a bit and what is taking its place is uncertainty, so we're seeing a little bit of sell-off and some repositioning into fixed income."

Morelock said lackluster economic data released in the early hours of the day also contributed to caution among investors. "As time goes on and the realization of the gridlock in Washington grows, focus shifts back to the economy and the data certainly hasn't indicated a full-steam-ahead economy," Morelock said.

The Conference Board Consumer Confidence Index fell during January after rising in December 2016. The Index now stands at 111.8, down from 113.3 in December 2016, the Conference Board said. The Present Situation Index increased from 123.5 to 129.7, but the Expectations Index decreased from 106.4 last month to 99.8.

Additionally, the Federal Open Market Committee opened its first meeting of 2017 on Tuesday and will issue its first monetary policy statement Feb. 1. Morelock said "not much has changed" for policymakers since November 2016 in terms of the overall economic outlook and that its statement will likely reflect that.

The Dow Jones Industrial Average dipped 0.54% to 19,864.09, the S&P 500 was down 0.09% to 2,278.87, while the Nasdaq composite made up initial declines to edge up 0.02% higher to 5,614.79.

First NBC Bank Holding Co. shares plummeted during the day, falling by 32.77% to $4.00 by the close of trading, after the company disclosed that it will record a material valuation allowance related to its deferred tax asset at the end of 2016. The company said it is unable to estimate the amount of the valuation allowance at this time and also announced that it had agreed to file third- and fourth-quarter financial statements for 2016 by the end of April this year.

The banking industry's biggest players were mixed by the close of trading, with Bank of America Corp. falling 1.35% to $22.64, JPMorgan Chase & Co. declining 1.63% to $84.63 and Citigroup Inc. shares sliding to $55.83, down 1.38%.

Wells Fargo & Co. shares, meanwhile, rose 0.45% to $56.33, PNC Financial Services Group Inc. inched up 0.07% to $120.46 and Bank of New York Mellon Corp. shares closed 0.13% higher to $44.73.

Shares of Bryn Mawr Bank Corp. were down 0.74% to $40.05 after the company announced it agreed to acquire Royal Bancshares of Pennsylvania Inc. in a deal valued at about $127.7 million. Royal Bancshares of Pennsylvania added 2.06% to $3.97.

The S&P Corelogic Case-Shiller U.S. National Home Price NSA Index rose about 5.6% year-over-year during November 2016. The index rose 0.8% on a month-over-month basis after seasonal adjustments.

Among thrifts, New York Community Bancorp Inc. gained 0.26% to $15.19, while TFS Financial Corp. (MHC) shares fell 2.94% to $17.49.

Market prices and index values are current as of the time of publication and are subject to change