Bank stocks had a slightly steeper fall than the large indexes in trading Dec. 16, showing some signs of cooling following the market's post-election surge.
The SNL U.S. Bank Index lost 0.99% to 531.32, while the S&P 500 fell 0.18% to 2,258.07 and the Nasdaq composite index decreased 0.36% to 5,437.16. The Dow Jones Industrial Average continued to flirt with the 20,000 mark but never reached it in intraday trading, instead closing down 0.04% to 19,843.41.
David Levy, portfolio manager at Republic Wealth Advisors, said the markets are "showing some pause" following the Federal Reserve's announcement Wednesday, where members of the Federal Open Market Committee voted unanimously to raise the target federal funds rate by 25 basis points to a range of 0.50% to 0.75%. In a statement, the Fed noted "solid" job gains and growth toward its 2% inflation target in allowing the central bank to hike its benchmark interest rate.
Levy said he sees the "overbought" market calming down as it heads into the holiday season, but not solely because of the rate hike.
"It's hard to suggest specifically that's the reason for the market pullback because I don't think any market participants were especially surprised by what the Fed communicated," Levy said.
Financials, which had a noticeable boost in the post-election rally, had harder falls in trading. Shares of JPMorgan Chase & Co. fell 1.23% to $84.94, Bank of America Corp. slipped 2.16% to $22.66 and Citigroup Inc. decreased 0.80% to $59.75. Wells Fargo & Co. added 0.27% to $55.34.
Notable movers included Clinton, N.J.-based Unity Bancorp Inc., which added 10.96% to $16.70, and New Orleans-based First NBC Bank Holding Co., which gained 6.15% to $6.90. First NBC Bank has experienced a period of volatility after a chain of events involving a consent order, investor group activism and leadership changes.
Charleston, W.Va.-based United Bankshares Inc. saw large volume trades that pushed the stock down 6.20% to $45.35 after the Fed announced it had denied commenters' requests to extend the comment period on the bank's proposed acquisition of McLean, Va.-based Cardinal Financial Corp. Shares of Cardinal fell 5.81% to $31.96. On Dec. 15, United announced a public offering of 4,330,000 common shares; it announced the pricing for the offering Dec. 16.
In thrifts, the SNL U.S. Thrift Index fell 0.34% to 967.04. Westfield, Mass.-based Western New England Bancorp added 5.81% to $9.10 while Ottawa, Ill.-based Ottawa Bancorp Inc. slipped 4.95% to $12.11. New York Community Bancorp Inc. added 0.59% to $17.18.
Market prices and index values are current as of the time of publication and are subject to change.