Banking stocks tumbled Tuesday as dismal reports on consumer confidence and troubled banks indicate the sector is in for a painful recovery.
The KBW Bank Index fell 2.36%.
It was a rough day for the overall markets too, with the Dow Jones industrial average down 0.97% and the Standard & Poor’s 500 index falling 1.21%.
Two reports seemed to spark a broad sell-off. The Federal Deposit Insurance Corp. said in its quarterly banking report that the number of distressed banks in the U.S. has risen to its highest level in 16 years, thanks to increasing problems in commercial real estate. The Conference Board, a research group, said its closely watched consumer confidence index fell more than expected in February.
Bank of America Corp. fell 1.67%; JPMorgan Chase & Co., 2.37%; Wells Fargo & Co., 2.57%; and Citigroup Inc. fell 11 cents, to $3.35.
U.S. Bancorp fell 1.14%; State Street Corp., 1.97%; Regions Financial Corp., 4.11%; M&T Bank Corp., 1.11%; KeyCorp, 3.3%; and SunTrust Banks Inc., 3.76%.