Wall Street Drops, Led by Banks, as Investors Book Profits
(Reuters) - U.S. stocks opened lower on Friday, led by bank stocks, as investors booked profits after a record-setting few days and ahead of a long weekend.
Since President Donald Trump vowed last week to announce a tax reform in the coming weeks, Wall Street has hit record intraday and closing highs in successive days in a rally led by financials.
The S&P 500 financial index outperformed others with a gain of about 3.2 percent in the past week, while the KBW Bank index was up 3.8 percent. The S&P 500 gained 1.7 percent.
Those gains were cut sharply on Friday, with the broader financials down 0.65 percent and the banks down nearly 1 percent.
With a strong fourth-quarter earnings season mostly complete, many investors say they need concrete signs of progress from Trump on his policy plans to justify more gains.
In his first solo news conference on Thursday, Trump again offered little detail on his proposed reforms.
"Tax reforms are going to be as complicated as the repeal and replace (of the Affordable Care Act) and the markets may well think that the timing of the tax reform is going to be dragged out," said Art Hogan, chief market strategist at Wunderlich Equity Capital Markets in New York.
The lack of key economic data and a long weekend due to the Presidents Day holiday on Monday is also likely to keep investors from taking new positions, with trading volumes likely to be thin, on Friday.
At 9:34 a.m. ET (1434 GMT), the Dow Jones Industrial Average was down 82.08 points, or 0.4 percent, at 20,537.69, the S&P 500 was down 7.64 points, or 0.32 percent, at 2,339.58 and the Nasdaq Composite was down 13.78 points, or 0.24 percent, at 5,801.12.
Eight of the 11 major S&P sectors fell, with gains only in the defensive utilities, consumer staples and real estate sectors.
Bank of America JPMorgan and Citigroup were the top drags on the S&P 500 index.
Dow component UnitedHealth dropped 3 percent to $158.79 after the Justice Department joined a whistleblower lawsuit against the health insurer.
Kraft Heinz jumped 7.2 percent to $93.58 after it said it would continue to pursue a merger with Unilever, despite being rebuffed. Unilever's U.S.-listed shares surged more than 11 percent.
Mondelez, rumored to be a Kraft acquisition target, fell 2.3 percent to $42.22.
Declining issues outnumbered advancers on the NYSE by 1,712 to 879,. On the Nasdaq, 1,457 issues fell and 832 advanced.
The S&P 500 index showed 7 new 52-week highs and one new low, while the Nasdaq recorded 31 new highs and seven new lows.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Savio D'Souza)