Following Wednesday's Federal Open Market Committee induced boost, bank stocks closed lower Thursday, Feb. 2, amid geopolitical concerns.
The SNL U.S. Bank Index fell 0.62% to 527.08, while the SNL U.S. Thrift Index slipped 0.74% to 924.88. In the broader market, the Dow Jones Industrial Average slid 0.03% to 19,884.91, the Nasdaq composite index slipped 0.11% to 5,636.20 and the S&P 500 gained 0.06% to 2,280.85.
Jack Ablin, chief investment officer at BMO Private Bank, said Thursday's downturn is most likely associated with investors re-evaluating tail risks associated with the new administration.
"It just seems like there is some geopolitical noise, with some tension from Iran, that may have upset investors today," Ablin said. "None of this was really in the calculation when investors ushered in our new president on the heels of a pretty strong market. Investors were primarily focused on domestic policy, and really hadn't contemplated the possibility of international tension."
First BanCorp. took a major hit for the day, falling 6.12% to $6.44. On Wednesday, the company announced that stockholders comprised of funds affiliated with Thomas H. Lee Partners LP and funds managed by Oaktree Capital Management LP are selling a combined 20 million common shares of the company, par value 10 cents per share, in a public offering.
First NBC Bank Holding Co. fell 3.90% to $3.70. Among other notable movers, Boston Private Financial Holdings Inc. fell 2.74% to $16.00, Simmons First National Corp. dropped 2.56% to $59.05 and South State Corp. slid 2.12% to $85.50.
Citigroup Inc. added 0.16% to $55.98, Bank of America Corp. fell 0.74% to $22.72, JPMorgan Chase & Co. dipped 0.42% to $84.59 and Wells Fargo & Co. declined 0.29% to $55.75.
In the thrift space, BofI Holding Inc. lost 3.70% to $28.65, WSFS Financial Corp. dropped 3.30% $43.90 and Beneficial Bancorp Inc. slipped 2.35% to $16.65.
In economic news, unemployment insurance claims decreased for the week ending Jan. 28, with the advance figure for seasonally adjusted initial jobless claims hitting 246,000, according to the U.S. Labor Department. The previous week's revised level was 260,000. The four-week moving average was 248,000, compared to the previous period's revised level of 245,750.
Market prices and index values are current as of the time of publication and are subject to change.