Bank Stocks Take Hit As Trump Turmoil Continues

Big U.S. bank stocks dipped on Wednesday morning amid new concerns out of Washington D.C. regarding President Donald Trump and his administration.

Yesterday, news began to circulate, starting with a New York Times report claiming that former FBI Director James Comey compiled a memo and outlined conversations he had with Trump alleging that the president requested that Comey and the FBI stop their investigation into former national security adviser Michael Flynn. On top of Comey news, Trump shared potentially compromising intelligence with Russian officials last week.

President Trump defended on Tuesday his decision to share Israeli-gathered intelligence with Russian officials in the Oval Office.

As President I wanted to share with Russia (at an openly scheduled W.H. meeting) which I have the absolute right to do, facts pertaining....

— Donald J. Trump (@realDonaldTrump) May 16, 2017

...to terrorism and airline flight safety. Humanitarian reasons, plus I want Russia to greatly step up their fight against ISIS & terrorism.

— Donald J. Trump (@realDonaldTrump) May 16, 2017

These two recent damaging developments, along with a string of other concerns swirling around D.C. regarding Trump and his administration, have given rise to the possibility that his agenda will be stifled at every turn, and not just by Democrats.

Bank stocks fell on Wednesday morning amid fears that Trump’s pro-business, tax reform agenda could collapse. Trump’s plan to cut banking regulations, many of which were put in place after the 2008 financial crisis, fall into this same reform basket.

Shares of the so-called big four U.S. banks all took a slight dive. Bank of America (NYSE:C) dropped by 4.25%, while Citigroup (NYSE:C) fell by 3.03% in morning trading. JPMorgan Chase (NYSE:JPM) and Wells Fargo (NYSE:WFC) were also down marginally.

The benchmark Financial Select Sector SPDR Fund XLF is down 2.39%, with banking ETF’s (KBE) and (CO:KRE) both falling by over 3%. Since the November election, XLF had been up substantially, but it’s dipped since early March.

Financial giants Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS) dropped by over 4% in morning trading. The Dow Jones Industrial Average fell by 1% directly following the opening bell. The S&P 500 is also down nearly 1%.

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