Bank stocks fluctuated again Tuesday as investors remained concerned that the economy will worsen.
The KBW Bank Index was in positive territory for most of the morning but fell most of the afternoon. In late trading it inched upward to close down just 0.95%.
Matthew Shields, a trader at FIG Partners LLC, said in an interview Tuesday that the fluctuation in bank stocks was driven by "more general sentiment over the economy."
"There was no negative news pushing them lower, but there wasn't any positive news pushing them higher, either," Mr. Shields said.
The broader markets also seesawed Tuesday. The Dow Jones industrial average closed up 1.83%, and the Standard & Poor's 500 index up 0.98%.
Bloomberg News reported that Citigroup Inc.'s stock fell below $8 in intraday trading for the first time since 1995. The shares fell nearly 6% on the day, to close at $8.36.
The New York company said Monday that it was cutting 35,000 jobs in addition to 18,000 expected to go off the company's rolls with the divestitures of two businesses.
A source close to the company said Monday that Citi probably would keep looking for places to cut costs and staff even after the latest round is completed.
Zions Bancorp. rose for most of the day but closed off 1.9%. Sterne Agee analyst Edward Timmons upgraded the Salt Lake city company's stock to "hold," from "sell," saying the $1.4 billion it is to get from the Treasury Department's Capital Purchase Program should help Zions better absorb credit losses and make more loans. Though Mr. Timmons cut his 2009 earnings estimate to 83 cents a share, from $1.97 a share, he said that Zions' earnings could normalize in 2010.
Bank of America Corp. rose 1.1%; JPMorgan Chase & Co. fell 1.9%; Bank of New York Mellon Corp. rose 4.7%; and Wells Fargo & Co. fell 2.3%. KeyCorp rose 1.5%.
The decliners included U.S. Bancorp, off 0.3%; PNC Financial Services Group Inc., 6.3%; and SunTrust Banks Inc., 1.4%.