Bank Stocks Fade Late on Fiscal Worries: Financial Losers
Bank stocks weakened late during Friday's trading session, as President Obama met with Democratic leadership of the Senate and the Republican leadership of the House of Representatives in a last-minute attempt to hammer out a budget deal.
NEW YORK ( TheStreet) -- Bank stocks weakened late on Friday, as investors continued to wait and see if the fiscal cliff would be averted over the weekend. The broad indexes all saw declines of 1%, as did the KBW Bank Index ( I:BKX), which closed at 50.59, with all 24 index components showing declines. President Obama was scheduled to meet at 3PM Eastern time with the Democratic leadership of the Senate and the Republican leadership of the House of Representatives in order to push a scaled down agreement to avert the Fiscal Cliff, by holding off on federal income tax increases for most Americans and avoiding the massive federal spending cuts that are mandated without a new budget compromise. According to a Reuters report, a Senate Democratic aide said that the President probably wouldn't repeat his offer to limit tax increases to couples with combined incomes of over $400,000 per year, but would revert to his previous threshold of $250,000. Reuters also said that a "new factor" in the Fiscal Cliff negotiations was the direct involvement of Senate Minority Leader Mitch McConnell, "who held conversations with Obama this week." In economic news, the National Association of Realtors said that pending home sales "increased in November for the third straight month and reached the highest level in two-and-a-half years," with the Pending Home Sales Index coming in at 106.4, increasing from a downwardly revised 104.6 in October. The November reading increased from 96.9 a year earlier. NAR chief economist Lawrence Yun said that "even with market frictions related to the mortgage process, home contract activity continues to improve. Home sales are recovering now based solely on fundamental demand and favorable affordability conditions." The NAR also said that "on a year-over-year basis, pending home sales have risen for 19 consecutive months." The Institute for Supply Management said that in December its " Chicago Business Barometer was up for a third month, lumbering along since September's 3 year low." The December reading was 51.6, rising from 50.4 during November. A reading above 50 indicates expansion. Large-cap bank stocks declining by 1% on Friday included the "big four," with shares of Bank of America ( BAC) closing at $11.36 while Citigroup ( C) closed at $39.01, JPMorgan Chase ( JPM) closed at $43.24, and Wells Fargo ( WFC) closed at $33.91.