U.S. stocks fell at the close of trading on Wednesday, with technology shares declining as investors turned to defensive sectors, while bank stocks continued their recent losses following mixed quarterly results.
The S&P 500 lost 36.71 points, or 0.53%, to close at 6,927.03, while the Nasdaq Composite fell 228.69 points, or 0.96%, to 23,481.19. The Dow Jones Industrial Average declined 33.37 points, or 0.07%, to 49,158.62.
The banking index fell, with Wells Fargo shares tumbling after the bank failed to meet fourth-quarter profit expectations. Shares of Citigroup and Bank of America also declined, despite both exceeding Wall Street's fourth-quarter earnings estimates.
The financial sector, including banks that had posted strong gains during 2025, came under pressure this week amid concerns about US President Donald Trump’s proposal to cap interest rates on credit cards, which JPMorgan officials warned could put pressure on consumers and negatively impact the financial sector’s profits.
Michael O'Rourke, chief market strategist at Jones Trading, said investors are moving out of highly valued tech giant stocks and into value and defensive sectors. He also noted that the US president has targeted a number of industries as part of a policy that prioritizes the real economy over Wall Street.
Technology stocks declined, while defensive sectors such as consumer staples rose, and the Russell 2000 index of small-cap stocks, which has outperformed the Standard & Poor's 500 since the beginning of the year, also climbed.
