New York (AFP)
The New York Stock Exchange ended lower Wednesday, affected by the shares of large US banks who warned that their margins should be trimmed by the imminent decline in interest rates of the Federal Reserve (Fed).
Its flagship index, the Dow Jones Industrial Average, fell 0.42% to finish at 27,219.85 points.
The Nasdaq, with strong technological color, dropped 0.46% to 8,185.21 points.
The broad S & P 500 index lost 0.65% to close at 2,984.42 points.
Several major US banks, which publish their quarterly results, expressed their apprehension before the Fed's next interest rate cuts.
Bank of America (+ 0.93%), the second largest US bank in terms of assets, warned on Wednesday that it could severely reduce its margins.
JPMorgan Chase (-0.98%), Wells Fargo (-0.20%) and Citigroup (-0.70%), sent similar signals on Monday and Tuesday when they released their respective results.
"Bank of America has posted good results, but unfortunately that is not enough to drive up the market," said Gregori Volokhine, portfolio manager for Meeschaert Financial Services.
"We know that the fall in rates in July will be unfavorable to them," said Volokhine.
Interest rate cuts mean that banks are reducing their margins in the rates they charge their customers.
The markets were also responding to the sharp fall of the rail freight company CSX (-10.27%) which lowered its forecasts for the whole year.
She attributed this deterioration to economic uncertainties and the recent closure of a large refinery on the east coast, one of its customers.
"There is an over-interpretation of one-off events that affect the rail sector," Volokhine noted, while Union Pacific, another Wall Street-listed railway company, lost 6.05 percent.
© 2019 AFP