Bank stocks fell for a second straight day Friday on fears of tighter regulation as the broader markets dropped on other economic worries.
The KBW Bank Index closed down 2.65%, at 46.31; the KBW Regional Banking Index fell 2.21%, to 49.52.
Most of the stocks on the closely watched, 24-bank KBW Bank Index finished in the red.
Capital One Financial Corp. had an especially bad day, declining 12.32% a day after saying profit margins on loans were narrowing.
Megabanks with large capital markets operations continued to suffer a day after the Obama administration announced plans to curb banks' proprietary trading activity as well as their exposure to hedge and private-equity funds, which could have far-reaching implications for the lenders.
Bank of America Corp. fell 2.62%; JPMorgan Chase & Co., 3.43%; and Citigroup Inc., 2 cents a share to $3.25.
Some regional lenders fared better. Huntington Bancshares Inc. rose 3.53% after saying it expects to turn a profit this year on improving credit trends, despite losing money in the fourth quarter. Fifth Third Bancorp also gained slightly a day after less pain in its loan book translated into a narrower fourth-quarter loss. Its shares rose 0.67%.
Financial stocks were dragged down by other concerns, too; disappointing results in the technology sector pointed to a drawn-out economic recovery. Investors also worried that interest rate hikes in China could depress a global rebound.
The Dow Jones industrial average fell 2.09%, and the S&P 500 index was off 2.67%.
The banking stocks down for the day included BB&T Corp., off 3.16%; Comerica Inc., 0.56%; KeyCorp, 1.23%; M&T Bank Corp, 3.79%; PNC Financial Services Group Inc., 3.73%, and Regions Financial Corp., 3.79%.