Renewed Banking Concerns Contributing To Pullback On Wall Street

(RTTNews) - Stocks have moved mostly lower during trading on Friday, largely offsetting the strength seen in the previous session. The major averages have all shown notable moves to the downside on the day.

Currently, the major averages are just off their worst levels of the day. The Dow is down 270.41 points or 0.8 percent at 31,834.84, the Nasdaq is down 105.96 points or 0.9 percent at 11,681.44 and the S&P 500 is down 33.89 points or 0.9 percent at 3,914.83.

Renewed concerns about the health of the banking sector have inspired traders to cash in on yesterday's gains, which reflected optimism about an end to the Federal Reserve's tightening cycle.

U.S.-listed shares of Deutsche Bank (DB) have plunged by 5.8 percent amid a spike by the German lender's credit default swaps.

Credit Suisse (CS) and UBS Group (UBS) have also moved sharply lower after a report from Bloomberg said they are among banks under scrutiny in a Justice Department probe into whether financial professionals helped Russian oligarchs evade sanctions.

UBS' state-backed acquisition of troubled rival Credit Suisse for 3 billion Swiss francs, or $3.2 billion, helped ease concerns about recent banking industry turmoil earlier this week.

On the U.S. economic front, the Commerce Department released a report showing a continued slump in orders for transportation equipment led to an unexpected decrease in new orders for U.S. manufactured durable goods in the month of February.

The Commerce Department said durable goods orders slid by 1.0 percent in February after plummeting by a revised 5.0 percent in January.

Economists had expected durable goods orders to increase by 0.6 percent compared to the 4.5 percent plunge that had been reported for the previous month.

Excluding the steep drop in orders for transportation equipment, durable goods orders were unchanged in February after rising by 0.4 percent in January. Ex-transportation orders were expected to inch up by 0.2 percent.

Sector News

Brokerage stocks have shown a substantial move to the downside on the day, dragging the NYSE Arca Broker/Dealer Index down by 2.8 percent. The index is on pace to end the session at a five-month closing low.

Considerable weakness is also visible among semiconductor stocks, as reflected by the 2.5 percent slump by the Philadelphia Semiconductor Index. With the drop, the index is giving back ground after ending Thursday's trading at its best closing level in almost a year.

A steep drop by the price of crude oil is also weighing on energy stocks, with the NYSE Arca Oil Index and the Philadelphia Oil Service Index tumbling by 2.3 percent and 2.2 percent, respectively.

Banking, airline and computer hardware stocks are also seeing notable weakness, while gold and utilities stocks are bucking the downtrend.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Friday. Japan's Nikkei 225 Index edged down by 0.1 percent, while China's Shanghai Composite Index fell by 0.6 percent.

The major European markets have also shown significant moves to the downside on the day. While the U.K.'s FTSE 100 Index has tumbled by 1.5 percent, the French CAC 40 Index and the German DAX Index are both down by 1.9 percent.

In the bond market, treasuries have pulled back off their early highs but remain in positive territory. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 6.1 basis points at 3.345 percent.