Wall Street was near session lows late on Friday morning as Oracle led a decrease in tech stocks and financials came under pressure in the midst of Deutsche Bank’s massive $14 billion fine. The KBW Bank index .BKX dropped 1.25 percent, putting it on pace for its largest weekly fall since the Brexit vote in late June.
“The size of the Deutsche fine is putting pressure on the financials and is combined with the likelihood of the Fed putting off raising rates next week,” stated Thomas Wilson, senior investment manager at Brinker Capital.
Traders have all but ruled out the possibility of the Federal Reserve raising interest rates at its meeting that starts next Tuesday. Though, investors will carefully analyze the Fed’s comments on the recent lackluster economic data and its impact on when the central bank will eventually pull the trigger.
At 10:57 a.m. ET (1457 GMT), the Dow Jones Industrial Average dropped 72.62 points, or 0.4 percent, at 18,139.86. The S&P 500 fell 10.01 points, or 0.47 percent, at 2,137.25. The Nasdaq Composite decreased 14.19 points, or 0.27 percent, at 5,235.50.
The CBOE Market Volatility index gained 0.61 percent. The index, also known as Wall Street’s “fear gauge”, has declined only twice this week. Volatility was likely increase as investors unwind interests in futures and options contracts before expiration – a process better known as quadruple witching. Declining issues outnumbered advancing ones on the NYSE by 2,033 to 809. On the Nasdaq, 1,531 issues dropped and 1,121 gained. The S&P 500 index showed three new 52-week highs and no new lows, while the Nasdaq recorded 49 new highs and 27 new lows.