JP Morgan’s $2billion loss sinks US stocks

JPMorgan’s stunning $2 billion derivatives loss pummeled US stocks Friday, the bank’s 9.3 percent fall pulling other bank shares and the main market indices down with it.

The Dow Jones Industrial Average was down 34.44 points, or 0.27 percent, to 12,820.60 at the close, while the S&P 500 fell 4.60 (0.34 percent) to 1,353.39.

But the tech-rich Nasdaq barely bucked the trend, gaining 0.18 (0.01 percent) to 2,933.82.

Shares opened sharply down on the JPMorgan loss, rebounded into positive territory at mid-session, and then gave up their gains amid worries of wider repercussions in the financial system.

“The health of the credit markets and the banking system are critical to the economic recovery. The JPMorgan announcement is a blow to hopes that the US financial sector is steadily recovering from the debt implosion of recent years,” said Dick Green at Briefing.com