U.S. stocks end lower, led by drop in Nasdaq
The Dow Jones Industrial Average shed 42.36 points, or 0.09%, to 49,149.63, the S&P 500 declined 37.14 points, or 0.53%, to 6,926.60 and the Nasdaq Composite dropped 238.12 points, or 1.00%, to 23,471.75
U.S. stocks ended lower on Wednesday, led by a drop in the Nasdaq, with technology shares dropping as investors moved into more defensive areas, while bank stocks extended recent losses following some mixed quarterly results.
The S&P 500 bank index declined, with shares of Wells Fargo down 4.6% after the company missed fourth-quarter profit expectations.
The Dow Jones Industrial Average shed 42.36 points, or 0.09%, to 49,149.63, the S&P 500 declined 37.14 points, or 0.53%, to 6,926.60 and the Nasdaq Composite dropped 238.12 points, or 1.00%, to 23,471.75.
Citigroup and Bank of America shares also dropped, even after the companies beat U.S. stock market estimates for fourth-quarter profit.
Financials including the banks, which were up sharply in 2025, have declined this week amid concerns over U.S. President Donald Trump’s proposed cap on credit-card interest rates, which JPMorgan executives warned could squeeze consumers and hurt financial sector profits.
After a nice run, and so-so or mediocre earnings, you’re seeing profit-taking and consolidation in the banks, said Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut. Generally speaking, people are still optimistic on the group.
In addition, he said, the credit-card cap plan may never go forward, but none of the bank executives could rule it out.
In tech, he said, investors are looking to rotate out of expensive megacaps and into value and more defensive names.
S&P 500 financials shed along with the S&P 500 technology sector while more defensive groups including consumer staples gained. The small-cap Russell 2000 index, which has been sharply outperforming the benchmark S&P 500 so far this year, reached a record closing high, along with the S&P 500 industrials index.