US stock averages slip as bank shares head lower

U.S. stocks slipped Monday as Wall Street investors focused on a key investment bank’s first-quarter revenue missing analyst expectations.

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Goldman Sachs first-quarter revenue fell 12.6 percent to $8.8 billion, slightly less than analysts expected. Meanwhile, profits declined 20 percent to $2.2 billion, or $5.71 per share, higher than Wall Street predictions. Bolstered by record net interest income, earnings in its investing and lending division was $835 million.


The decline in Goldman Sachs shares accounted for all of the decline in the blue-chip Dow Jones Industrial Average, which began Monday’s session close to its record high of 26,828.39, a mark reached Oct. 3, 2018. Likewise, the broader S&P 500 began the session near its record high of 2,930.75.

By early afternoon the major averages were paring their losses after Chicago Fed President Charles Evans said, in prepared comments, that he supported a higher inflation target and that rate cuts might be necessary. Nevertheless, those averages closed fractionally lower.

Ticker Security Last Change %Chg GS GOLDMAN SACHS GROUP INC. 199.91 -7.93 -3.82% C CITIGROUP INC. 67.38 -0.04 -0.06% BAC BANK OF AMERICA CORP. 29.84 -0.33 -1.09% JPM JP MORGAN CHASE & CO. 109.94 -1.27 -1.14%

“Frankly, though, given how muted inflationary pressures appear today, a rise to 2-1/4 to 2-1/2 percent is not a big concern to me at the moment,” Evans said. “In contrast, if activity softens more than expected or if inflation and inflation expectations run too low, then policy may have to be left on hold — or perhaps even loosened — to provide the appropriate accommodation to obtain our objectives. As we often say, policy will be data dependent.”

Citi reported a 24 percent decline in stock trading revenue, and total revenue was down 2 percent from a year earlier.

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