Financial stocks hit by Goldman woes
The SEC's action against the investment house sets off selling in financial stocks. Among the hardest hit: JPMorgan Chase, Bank of America and Moody's.
Updated at 2:20 p.m. ET
It's a terrible day to be invested in financial stocks today, not just a terrible day to be invested in Goldman Sachs (GS).
Just about every stock in the sector was lower this afternoon after the Securities and Exchange Commission said it had sued the investment bank for fraud in the marketing of a financial product based on subprime mortgages that was secretly designed to lose value.
The financial-sector index of the Standard & Poor's 500 Index ($INX) was off 3.4% today and had been down as much as 5.3%, its steepest intraday decline since September.
The S&P 500 Financial exchange-traded fund (XLF), which is based on the financial sector, was down 3.1% to $16.46 and had been down as much as 5.4%.
Goldman Sachs was down more than 11.5% to $162.25 at 2 p.m. ET. It had been down as much as 15.6% in the morning.
Goldman said the SEC charges are "completely unfounded in law and fact" and promised to "vigorously contest them and defend the firm and its reputation."
JPMorgan Chase (JPM) was down 4% to $45.92, subtracting 14 points from the Dow Jones Industrial Average ($INDU) by itself.
At 2:20 p.m. ET, the Dow was down 97 points to 11,047. It had been down as much as 171 points before turning up again.
The Securities and Exchange Commission's fraud accusations against Goldman Sachs spurred concern the fallout from the financial crisis isn’t over.
Indeed, Robert Khuzami, the SEC's director of the Division of Enforcement, said the commission is still investigating the subprime-mortgage disaster.
Bank of America (BAC), despite returning to profitability in the first quarter, was down 4.1% to $18.68, subtracting nearly 7 points from the Dow.
Morgan Stanley (MS) was off 4.5% to $29.49. Citigroup (C) dropped 5.4% to $4.55.
Rating agency Moody's (MCO) was off 4.8% to $28.21.
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
John Stumpf acknowledges that growth has been slow, but he says he's still optimistic.