Weak bank shares lead US stocks lower

Bank of America and Wells Fargo both lost 1.7 per cent.
Bank of America and Wells Fargo both lost 1.7 per cent.PHOTO: BLOOMBERG

NEW YORK (AFP) - Shares of large banks retreated on Thursday on dimming expectations of a hike in US interest rates as Wall Street stocks finished modestly lower.

Bank of America and Wells Fargo both lost 1.7 per cent, joining Goldman Sachs, JPMorgan Chase and others in falling ahead of next week's Federal Reserve monetary policy meeting.

Analysts see almost no chance of an interest rate hike next week following poor US May jobs data.

Buying sentiment was further dented by lower oil prices, weakness in European bourses and bearish statements about the economy from veteran billionaire investors Carl Icahn and George Soros.

The Dow Jones Industrial Average dropped 0.1 per cent to 17,985.19.

The broad-based S&P 500 shed 0.2 per cent at 2,115.48, while the tech-rich Nasdaq Composite Index fell 0.3 per cent to 4,958.62.

Petroleum-linked shares were in retreat, with Schlumberger falling 1.1 per cent, Marathon Oil 1.9 per cent and Anadarko Petroleum 1.3 per cent.

Barrick Gold climbed 1.9 percent on higher gold prices, but Freeport-McMoRan, which produces copper and oil in addition to gold, tumbled 5.9 per cent as copper and oil prices fell.

 

Yahoo rose 1 per cent on reports that several suitors are bidding US$5 billion (S$6.7 billion) or more for the core business of the faded Internet pioneer.

CNBC, citing unnamed sources close to the situation, said Yahoo's board of directors will meet Friday to review offers ahead of a final round of bidding expected to lead to a decision by mid-July.

J.M. Smucker jumped 7.9 per cent after reporting fourth-quarter earnings of US$191 million, compared with a loss of US$90.3 million in the year-ago period. The 2015 period was hit by heavy costs associated with its acquisition of the Big Heart pet food company.

LinkedIn shot up 2 per cent after it was upgraded by RBC Capital Markets, citing survey data showing strong customer approval for the online professional network service and the potential to generate revenue from targeted advertising.