Wall Street ends lower on angst over Portugal's bank woes
US stocks dropped today as concerns about the financial health of Portugal's top listed bank gave investors a reason to cash in recent gains.
With the Dow and the S&P 500 near record highs, the slide in Europe triggered by financial shares quickly translated into broad selling on Wall Street. The S&P 500 briefly lost 1 percent earlier, a daily drop the benchmark has not seen since April 10.
The S&P 500 financial sector index fell 0.5 percent. Wells Fargo & Co, a component of the S&P financial index, fell 0.7 percent to $51.81. The bank will report earnings on Friday.
The yield on the 10-year US Treasury note briefly dropped to 2.494 percent, its lowest since June 2.
The Dow Jones industrial average fell 70.54 points or 0.42 percent, to 16,915.07. The S&P 500 slid 8.15 points or 0.41 percent, to 1,964.68. The Nasdaq Composite dropped 22.83 points or 0.52 percent, to 4,396.20.
With today’s decline, the S&P 500 was down 1 percent for the week and on track for its biggest weekly loss since April.
The Dow fell as much as 180.23 points shortly after the opening bell and then recovered to close about 85 points below the 17,000 milestone reached last week.
About 5.84 billion shares traded on US exchanges, in line with the 5.79 billion average in June, according to data from BATS Global Markets.
Decliners outnumbered advancers on the New York Stock Exchange by a ratio of about 2.3 to 1. On the Nasdaq, three stocks fell for every one that rose.
European stock markets were hit hardest as trading in Banco Espirito Santo was halted after a 19 percent drop. The bank's largest shareholder suspended trading in its own shares and bonds due to "material difficulties" at its own largest shareholder.
The developments in Europe, following the recent collapse of a Spanish technology company, buttressed concerns stock valuations were getting rich after a long streak of gains.
European bank shares were stung. The STOXX Europe 600 Banking Index fell 1.7 percent to its lowest since mid-December.
Yields rose on bonds issued by southern European governments at the heart of four years of euro zone turmoil. Greece managed to place just half of a planned three-billion-euro bond.
Oil prices fell for a ninth session, with Brent dipping under $108 a barrel in the commodity's longest losing streak in four years while US light crude slipped 0.16 percent to $102.13, pressured by weak US gasoline demand and the prospect of rising Libyan supply.