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Wednesday's Bank Stocks: Industry falls as Fed announces rate hike

Bank stocks traded down Dec. 13 as Federal Reserve Chair Janet Yellen announced that the central bank would be raising the benchmark interest rate for the third time in 2017, to a target range of 1.25% to 1.50%.

In her last press conference for a Federal Open Market Committee meeting, Yellen said the labor market looks strong but continued to see soft readings on inflation. Yellen insisted that the Fed still sees inflation rising to the central bank's 2% target, continuing to blame the current drag on "transitory" and one-off pricing anomalies like the costs of cell phone contracts.

Yellen also spoke on the tax reform efforts on Capitol Hill, which she saw as an opportunity to stir "modestly faster growth over the next couple of years" if it follows through on stimulating consumer and investment spending. Republican members of the House and the Senate reportedly reached a deal on a bill that, among other things, would peg the corporate tax rate at 21%.

The SNL U.S. Bank Index lost 1.23% to 611.32. All of the large four banks fell in trading, as JPMorgan Chase & Co. declined 1.25% to $105.51, Bank of America Corp. lost 1.64% to $28.84, Citigroup Inc. slipped 1.33% to $75.14 and Wells Fargo & Co. decreased 1.54% to $59.40.

Waldorf, Md.-based Community Financial Corp. gained 5.80% to $39.20 while Fort Lauderdale, Fla.-based OptimumBank Holdings Inc. dropped 3.11% to $5.30.

The SNL U.S. Thrift Index declined 0.32% to 936.82.

The broader markets fared better, as the Dow Jones Industrial Average increased 0.33% to 24,585.43, the S&P 500 ticked down 0.05% to 2,662.85 and the Nasdaq Composite Index gained 0.20% to 6,875.80.

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