Banks tumble with interest rates; stocks slide
The New York Stock Exchange on Wall Street on July 15, 2013. Credit: AP / Mark Lennihan
Stocks slumped Monday, and banks took the biggest losses. Deutsche Bank plunged as investors worried about the financial health of Germany’s largest bank.
Pfizer pulled drugmakers down after it announced it won’t break up into two companies.
Stocks fell for the second day in a row. Banks were hurt by a drop in bond yields, which means lower interest rates and smaller profits on loans. Consumer companies fell as home improvement retailers were affected by a slowdown in sales of new homes.
The German magazine Focus said Deutsche Bank won’t get a government bailout if it asks for one. Its report, published Friday, cited “government circles” as its source. The bank’s U.S.-listed shares tumbled 90 cents, or 7.1 percent, to $11.85. The stock is down 51 percent this year.
“There’s some stress in the banking industry there,” said Steve Chiavarone, associated portfolio manager for Federated Investors.
The Dow Jones industrial average lost 166.62 points, or 0.9 percent, to 18,094.83. The Standard & Poor’s 500 index fell 18.59 points, or 0.9 percent, to 2,146.10. The Nasdaq composite dropped 48.26 points, or 0.8 percent, to 5,257.49. The Nasdaq set all-time highs twice last week.
