NEW YORK (Reuters) – Wall Street’s main indexes finished lower on Friday, weighed down by big U.S. banks after their earnings reports, while the energy fell sharply due to a regulatory probe into Exxon Mobil Corp.
The S&P 500 banks index lost ground as shares of Wells Fargo & Co, JPMorgan Chase & Co and Citigroup Inc tumbled even though they had posted better-than-expected fourth-quarter profits. The bank sector had rallied sharply in recent days.
Wells Fargo, down 7.8%, was among the biggest drags on the S&P 500, along with Exxon Mobil, down 4.8%.
“Financials and energy have been disappointing … that’s bringing down the whole market,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina.
“This year is the year for financials, energy, materials, industrials. So if there is a day when they’re not leading, it’s not good news for the market.”
Wall Street’s major indexes had recently hit record highs on hopes for a hefty fiscal stimulus package.
Incoming U.S. President Joe Biden late on Thursday unveiled a $1.9 trillion stimulus proposal, which included some $1 trillion in direct relief to households.
Meanwhile, data showed a further decline in U.S. retail sales in December in the latest sign the economy lost considerable speed at the end of 2020.
“The weaker-than-expected economic data, and especially in parts of the economy like retail sales, is a big driver,” said Liz Ann Sonders, chief investment strategist at Charles Schwab.
