NEW YORK — JPMorgan Chase’s surprise $2 billion trading loss prompted a sell-off in financial stocks Friday, with smaller declines across the broader market as investors decided this was more of a problem for investment banks than for other industries.
Most of the 10 industries in the Standard & Poor’s 500 index were flat or posted modest declines; financial stocks fell 1.1 percent.
For that, the other investment banks could thank JPMorgan, America’s biggest bank. The stock plunged 9.3 percent, dragging other banks with big Wall Street operations down with it. Morgan Stanley fell 4.2 percent, and Goldman Sachs fell 3.9 percent. Citigroup fell 4.2 percent.
Retail-focused banks fared better. Wells Fargo edged up 0.4 percent.
JPMorgan’s blunder comes in the midst of a political battle over how closely to regulate banks, although JPMorgan chief executive Jamie Dimon said the trades would not have been affected by the so-called Volcker rule, expected to take effect this summer. Still, the $2 billion loss is sure to be used as ammunition by those pushing for tighter regulation of investment banks.
The Dow Jones industrial average fell 34.44 points to close at 12,820.60. It had waffled around with small gains and losses throughout most of the day before settling into the red in the afternoon.
The Standard & Poor’s 500 fell 4.60 points to close at 1,353.39. The Nasdaq composite, which is heavily weighted with technology stocks, was up 0.18 points to 2,933.82.
Microsoft and Intel both rose 1.4 percent after Intel told analysts that it is on track to meet sales expectations. Tech investors were relieved to hear that news one day after Cisco Systems prompted selling in tech shares by being pessimistic about sales. Semiconductor-maker Nvidia jumped 6.4 percent after reporting revenue that was higher than analysts were expecting.
A big decline in gas and energy costs drove
the Producer Price Index to drop 0.2 percent last month from the previous month, the Labor Department said.
It was the first decline since December and the biggest one-month drop since October.
