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PacWest reports deposits fell 9.5% last week
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Energy shares lower
(Updates to close)
By Caroline Valetkevitch
NEW YORK May 11 (Reuters) - The Dow and the S&P 500
ended lower on Thursday, dragged down by Walt Disney Co ,
which reported weaker subscriber growth, and declines in
regional bank and energy stocks.
Lifting the Nasdaq, shares of Alphabet Inc rose, a
day after Google rolled out more artificial intelligence
products to take on competition from Microsoft Corp .
Microsoft shares fell and were among the biggest negative
influences on the S&P 500 and Nasdaq.
PacWest Bancorp shares dropped after it reported
its deposits fell 9.5% last week and that it had posted more
collateral to the U.S. Federal Reserve to boost its liquidity.
Other regional bank shares fell as well, as the news renewed
worries about the industry's health following the recent
collapse of three regional lenders.
"I don't think you can say that it is a widespread issue. It is still very much bank by bank. But there's very likely to be more consolidation and more headaches for regional bank investors," said Oliver Pursche, senior vice president and advisor at Wealthspire Advisors in Westport, Connecticut.
Walt Disney shares slid after the company reported quarterly results late Wednesday. The energy sector fell along with declines in oil prices. According to preliminary data, the S&P 500 lost 7.63 points, or 0.18%, to end at 4,130.01 points, while the Nasdaq Composite gained 20.13 points, or 0.16%, to 12,326.57. The Dow Jones Industrial Average fell 227.35 points, or 0.68%, to 33,303.98. Shares of Tesla jumped in late trading after Elon Musk said in a tweet that he had found a new chief executive for Twitter. The U.S. Federal Deposit Insurance Corporation said around 113 of the country's largest lenders will bear the cost of replenishing the $16 billion in coverage the agency has forked out for the crisis.
Also keeping investors on edge was the recent standoff in Washington over raising the U.S. debt ceiling. "As we get closer and closer to the debt ceiling deadline, you're going to have more volatility," Pursche said. (Additional reporting by Shreyashi Sanyal and Shristi Achar A in Bengaluru; Editing by Saumyadeb Chakrabarty, Anil D'Silva and Richard Chang)
