U.S. stocks slid on Friday as investors booked profits in the wake of a recent surge, and bank shares dropped after several bank executives indicated March had been a tougher month than the previous two.
After the meeting with President Barack Obama, JPMorgan Chase & Co's
Bank of America Corp's
Given that's kind of where this rally started in the second week of the month with Citigroup and Bank of America indicating they had a good first two months (of 2009), it would make sense that his comments would have a negative impact, said Peter Jankovskis, director of research at OakBrook Investments LLC in Lisle, Illinois.
Citigroup fell 6.1 percent to $2.64 while JPMorgan Chase
The Dow Jones industrial average <.DJI> dropped 128.07 points, or 1.62 percent, to 7,796.49. The Standard & Poor's 500 Index <.SPX> slid 13.11 points, or 1.57 percent, to 819.75. The Nasdaq Composite Index <.IXIC> fell 32.82 points, or 2.07 percent, to 1,554.18.
Tumbling oil prices sank energy shares as well, putting Exxon Mobil
Aside from another rush of bad banking news, traders pointed to profit-taking as another key factor for the pullback.
The recent rally has taken the broad S&P 500 index up more than 20 percent since it hit a 12-year low on March 9, although it is off nearly 10 percent for the year so far.
Stocks had rallied amid increasing optimism that the worst of the current downturn might be over as well as government action geared at stabilizing the ailing financial system.
Heading into the day's session, the S&P 500 was at its most overbought position since May 2008, according to its 50-day relative strength index.
Gains on Thursday had helped push the Nasdaq back into positive territory in the year-to-date, but a decline in big-cap technology shares pulled the index back in the red on Friday.
Shares of Intel
A drop in commodities prices weighed on stocks in the materials sector, and aluminum producer Alcoa