Financial sector stocks saw a sharp drop March 27, as a sell-off in the tech sector led to market-wide losses and 10-year Treasury yields fell.The declines were most prominent in the technology sector, with the Nasdaq Composite Index sinking 2.93% to 7,008.81. The S&P 500 retreated 1.73% to 2,612.62, while the Dow Jones Industrial Average slid 1.43% to 23,857.71.
Bank stocks also tumbled. The Big Four banks all posted decreases, with Wells Fargo & Co. shedding 2.28% to $51.10; Bank of America Corp. declining 3.02% to $29.52; Citigroup Inc. slumping 2.15% to $68.28; and JPMorgan Chase & Co. ending down 1.94% to $108.17.
Robin Anderson, senior economist at Principal Global Investors, said bank stocks took a hit as increased market volatility led investors to stock up on U.S. Treasurys, driving up their prices and in turn decreasing their yields. The yield on 10-year Treasurys fell to 2.79% as of 2:59 p.m. ET, down from the previous close of 2.84%, according to Yahoo Finance. Financial stocks generally take a hit when longer-term rates fall, as those moves decrease bank profits, Anderson said.
"What we saw today is money moving into safe havens," Anderson said.
First Financial Bancorp. saw significant gains, adding 2.74% to $28.15. But several companies saw major drops: SVB Financial Group slumped 4.11% to $239.21; East West Bancorp Inc. shrank 3.23% to $60.78; Hancock Holding Co. tumbled 3.07% to $50.60; Citizens Financial Group Inc. dropped 3.55% to $41.59; Webster Financial Corp. ended down 3.85% to $54.00; and KeyCorp fell 3.31% to $19.27.
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