Updated from 1:53 p.m. EDT

Financial stocks fell Tuesday in lockstep with the major indices, caught in the broader market's undertow and pressured by sector-specific analyst downgrades, among other things.

Franklin Resources ( BEN - Get Report), an asset manager based in San Mateo, Calif., sank 2.6% to $133.66 after an analyst with J.P. Morgan said its funds have been turning in poor performances lately. He cut the stock to underweight from neutral.

Keefe Bruyette, meanwhile, lowered Synovus Financial ( SNV - Get Report) to market perform from outperform, after which the Georgia bank's shares slumped 1.5%, or 48 cents, to $32.58.

Franklin and Synovus, both components of the NYSE Financial Sector Index, helped pull the tracker down 0.7% to 9910.90. Most of the index's other members were likewise falling -- among them, credit-card company MasterCard ( MA - Get Report), down 2.1%; insurance broker National Financial Partners ( NFP), down 1.9%; and broker Friedman Billings Ramsey ( FBR), down 3.1%.

The KBW Bank Index fared even worse, giving up 0.8% at 116.40 as every single one of its components foundered in the red.

Also suffering was Pacific Capital Bancorp ( PCBC), based in Santa Barbara, Calif., which lost 3.1% to $25.09 on word its chief financial officer, Joyce Clinton, will leave the bank in August. New York broker Jefferies ( JEF) sank 2.4% to $29.73 after announcing it sold $600 million in senior bonds.

Elsewhere, credit-ratings firm Moody's ( MCO - Get Report) slipped even as it boosted its full-year 2007 guidance for both income and revenue. The New York-based company also maintained its prior forecast for an operating-margin slide of up to 150 basis points. Shares eased 66 cents, or 0.9%, to $70.36.

Savings bank BFC Financial was up 2.7% earlier in the day but closed down 0.9% at $4.40. Asset manager Janus Capital ( JNS), up 1% earlier in the day, closed down 0.6% at $28.27.

Among the few financial stocks on the upswing, New York lender Financial Federal ( FIF - Get Report) jumped 4.6% to $28.77 after saying that fiscal third-quarter earnings climbed 14.3% year over year to 48 cents a share, or $12.7 million. Analysts polled by Thomson Financial sought 46 cents a share.

Other scarce financial winners included mortgage lender Fannie Mae , which added 0.3% to $64.82.