Exchange-traded funds that buy stocks in the financial sector were struggling Wednesday, with Morgan Stanley’s steep drop landing it among the S&P 500’s worst performers. Shares of the Financial Select Sector SPDR Fund
which tracks financial companies in the S&P 500 index, was down 1.3% on Wednesday afternoon, according to FactSet data, at last check. Morgan Stanley’s stock was tumbling 7.7% in Wednesday afternoon trading, after the bank reported a fall in third-quarter profit, although the results beat analysts’ expectations.
Financial stocks were lagging the broader S&P 500 index on Wednesday, as other Wall Street banks such as Goldman Sachs Group Inc.
and Citigroup Inc.
also saw sharp declines. The S&P 500 was trading 0.7% lower on Wednesday afternoon, according to FactSet data, at last check. The financial sector has posted losses so far this year, in contrast to the S&P 500’s roughly 13% gain. Bank-focused ETFs were hammered earlier this year after regional banks collapsed and investors worried that the rise in Treasury yields was creating cracks in the financial system. The SPDR S&P Regional Banking ETF
has plummeted more than 29% this year, including a sharp 1.9% decline on Wednesday afternoon, FactSet data show, at last check. The Invesco KBW Bank ETF
which tracks the broad banking industry, was down 2.1% in one of its worst trading sessions so far this month, bringing the fund’s plunge this year to almost 24%.
is on pace for its largest percentage drop since June 11, 2020, when it fell around 8.5%, according to Dow Jones Market Data. Meanwhile, the S&P 500’s financial sector
is down almost 3% this year based on Wednesday afternoon trading. In the bond market, long-term Treasury yields were continuing to climb on Wednesday, with 10-year rates up five basis points at around 4.89% in the af …