Banking stocks had a volatile day Monday as investors sold shares to take advantage of gains from last week while digesting some mixed analyst reports on individual names.
The KBW Bank Index fell 0.48%.
Frank Barkocy, the director of research at Mendon Capital Advisors Corp., said the decline reflected a sell-off following last weeks modest gains driven by positive commentary out of a major banking conference. "We had some profit-taking today," he said.
It was a mixed day for some of the largest companies, Barkocy said.
Bank of America Corp. dropped 2.16%, as investors absorbed the news that it may drop a loss-sharing agreement with the government. Citigroup Inc., meanwhile, gained 17 cents to $4.43. Barkocy said investors may have been heartened by a speech Citi Chief Executive Vikram Pandit gave Friday, in which he said the company would restructure its energy trading business, among other things.
William Fitzpatrick, an analyst with Optique Capital Management., said investors also spent the day absorbing a number of mixed analysts reports. "There were a series of upgrades and downgrades — that is why you have a widespread dispersion among the financials," he said.
For instance, Sanford Bernstein raised its rating and price target on Wells Fargo & Co. while Goldman Sachs Group Inc. analysts downgraded Bank of New York Mellon Corp.
Wells Fargo fell 0.7% and Bank of New York Mellon declined 2.21%.
Other decliners included Northern Trust Corp., off 0.7%, State Street Corp., 3.92% and U.S. Bancorp, 1.45%.
Gainers included PNC Financial Services Group Inc., up 0.78%, Marshall & Ilsley Corp., 3.95% and Huntington Bancshares Inc., 1.38%.