U.S. stocks fall as bank sector comes under pressure

© Reuters.

By Liz Moyer 

Investing.com -- U.S. stocks were falling as bank stocks come under pressure, while new data on jobs alleviated concerns about aggressive interest rate moves by the Federal Reserve.

At 11:58 ET (16:58 GMT), the Dow Jones Industrial Average was down 46 points or 0.1%, while the S&P 500 was down 0.3% and the NASDAQ Composite was down 0.4%.

The economy added 311,000 jobs last month, more than the 205,000 expected, but the unemployment rate rose to 3.6%. Analysts had expected it to remain at 3.4%. And average hourly earnings rose 0.2%, lower than expected.

Futures traders have lowered the chances of a half percentage point rate hike by the Fed this month. It was at 70% earlier this week and is now under 50%, according to the CME FedWatch tool. Traders give the odds of a quarter-point rate hike slightly higher than 50%.

SVB Financial Group (NASDAQ:SIVB) was closed today by California banking regulators after failing to raise capital. The shares were halted all morning on Friday after falling 60% on Thursday. The bank, which has a high profile in the venture capital world, was squeezed by rising interest rates. It announced a plan to reorganize its portfolio by selling securities at a loss and selling more shares to raise capital.

Its struggle was spilling over to other bank stocks though that has eased up about an hour into trading. The KBW Nasdaq Bank Index was down 1.9% on Friday.

Gap, Inc. (NYSE:GPS) shares were down 5.7% after reporting a quarterly loss on a drop in sales and weaker than expected guidance for the first quarter and year.