U.S. stocks fell on Friday after the Federal Reserve said it will not extend a pandemic-era rule that had allowed banks to relax capital levels.
The Dow Jones Industrials faltered 288.15 points to begin Friday at 32,574.15.
The S&P lost 24.13 points to 3,891.33.
The NASDAQ Composite dropped 53.42 points to 13,062.75.
The major averages were on track to post a losing week with the S&P 500 off by 0.9% this week and the NASDAQ is down 1.3%. The Dow has dipped 0.3%.
The central bank on Friday declined to extend a rule expiring at the end of the month that relaxed the supplementary leverage ratio for banks during the pandemic. The rule allowing banks to hold less capital against Treasurys and other holdings was implemented to calm the bond market during the crisis and encourage banks to lend.
Bank stocks sold off in unison following the Fed decision. JPMorgan and Wells Fargo both slid 3%, while Goldman Sachs fell 1.5%.
The decision could have some adverse effects, traders have warned, if in response banks sell some of their Treasury holdings. That could send yields even higher at a time when a rapid rise in rates is already unnerving investors.
Shares of FedEx jumped 6% Friday after the delivery company beat expectations on the top and bottom lines for its fiscal third quarter.
Nike's stock slipped by 4% after third-quarter revenues were weaker than anticipated.
Prices for 10-Year Treasurys faltered, raising yields to 1.74% from Thursday's 1.71%. Treasury prices and yields move in opposite directions.
Oil prices lost 49 cents to $59.51 U.S. a barrel.
Gold prices gained $1.90 to $1,734.40.