Wall Street drops after tepid big bank results

(Reuters) – Wall Street’s main indexes fell on Monday, following a rally in the previous session that put the S&P 500 within striking distance of its record high, as underwhelming results from Goldman Sachs and Citigroup pressured financial stocks.

FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., April 9, 2019. REUTERS/Brendan McDermid

The sector fell for the first time in four sessions, down 0.75%, dragged lower by a 3.2% tumble in Goldman Sachs Group Inc and a 0.7% dip in Citigroup Inc after the banks missed revenue estimates.

The S&P banking index fell 1.12%, also weighed down by a 1.6% drop in JPMorgan Chase. Bank of America dipped 1.4% ahead of results on Tuesday.

“With less-than-stellar Goldman results, despite the bottom-line beat, it’s not necessarily surprising to see financials pulling back a little bit,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

“Earnings and guidance need to be better than estimates for the market strength to continue given the levels we are at now.”

Monday’s reports come in contrast to JPMorgan’s upbeat earnings on Friday that eased worries of first-quarter earnings season slamming the brakes on Wall Street’s big rally back from last year’s slump.

The benchmark S&P 500 index is just about 1% away from its September record closing high.

On trade discussions, Reuters reported that U.S. negotiators have tempered demands that China curb industrial subsidies as a condition for a trade deal, while Treasury Secretary Steven Mnuchin said he hoped the talks were approaching a final lap.

At 12:09 p.m. ET, the Dow Jones Industrial Average was down 86.50 points, or 0.33%, at 26,325.80. The S&P 500 was down 9.31 points, or 0.32%, at 2,898.10. The Nasdaq Composite was down 37.15 points, or

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