Updated from 3:16 p.m. EDTFinancial stocks sank late Wednesday as the broader market weakened in the afternoon. Morgan Stanley ( MS) dragged on bank stocks early when it aired its quarterly results, but the sector reversed course shortly after the open. Financials changed direction again, though, and the KBW Bank Index ultimately lost 4.9%. Morgan Stanley shares fell 9% to $22.44 after it reported that it swung to a first-quarter loss on a rebound in its bond prices. The company also is cutting its quarterly dividend 81% to 5 cents a share.