Stocks end lower on Portugal bank woes
July 10. 2014 8:05PM
NEW YORK (Reuters) — Stocks dropped on Thursday as concerns about the financial health of Portugal’s top listed bank gave investors a reason to cash in recent gains.
With the Dow and the S&P 500 near record highs, the slide in Europe triggered by financial shares quickly translated into broad selling on Wall Street. The S&P 500 briefly lost 1 percent earlier, a daily drop the benchmark has not seen since April 10.
Espirito Santo Financial Group, the largest shareholder in Portugal’s Banco Espirito Santo, suspended trading in its shares and bonds, citing “material difficulties” at parent company ESI. The bank’s shares tumbled 17.2 percent. Portugal’s benchmark stock index fell 4.2 percent and Italy’s FTSE MIB slid 1.9 percent.
The S&P 500 financial sector index fell 0.5 percent. Wells Fargo & Co, a component of the S&P financial index, fell 0.7 percent to $51.81. The bank will report earnings on Friday.
The Dow Jones industrial average fell 70.54 points or 0.42 percent, to 16,915.07. The S&P 500 slid 8.15 points or 0.41 percent, to 1,964.68. The Nasdaq Composite dropped 22.83 points or 0.52 percent, to 4,396.20.
With Thursday’s decline, the S&P 500 was down 1 percent for the week and on track for its biggest weekly loss since April.
The Dow fell as much as 180.23 points shortly after the opening bell and then recovered to close about 85 points below the 17,000 milestone reached last week.