U.S. stocks fall as banks slump, investors weigh Fed speeches

Banks Slump

The largest U.S. banks’ fixed-income trading revenue will probably fall 20% in the third quarter from a year ago on lower volumes, Richard Staite, an analyst at Atlantic Equities wrote in a note. Staite cut his estimate for Goldman Sachs’s per-share earnings 18% to $2.47 and Citigroup’s by 14% to $1.05.

Goldman Sachs slid 2.2% to $165.96 for the biggest retreat in the Dow. Citigroup sank 2.9% to $49.71. JPMorgan Chase & Co. retreated 1.9% to $51.78.

The S&P Supercomposite Homebuilding Index declined 1.1%, with all but two of its 11 members falling. Lennar slid 1.1% to $34.78 while KB Home lost 3% to $17.11.

Lennar’s profit growth during the three months ended August probably slowed to 13% from 105% in the previous quarter while KB Home’s earnings may have increased 32%, less than half its pace in the previous quarter, analyst estimates compiled by Bloomberg show.

Apple, Pandora

Apple jumped 4.9% to $490.47. The company sold 9 million iPhone 5s and 5c models. That topped the 5 million in opening-weekend sales for last year’s model and surpassed analyst estimates that ranged from 6 million to 7.75 million, according to a Bloomberg poll.

Pandora Media Inc., the biggest web radio service, tumbled 11% to $24.11 after Apple said more than 11 million listeners have used iTunes Radio since its launch this year.

BlackBerry Ltd. added 1.3% to $8.84. The company entered a tentative agreement for a $4.7 billion buyout from a group led by its biggest shareholder, Fairfax Financial Holdings Ltd., forging a path to go private after a new line of smartphones failed to catch on.

BlackBerry Downgrade

Shares of BlackBerry fell as much as 6.1% earlier as Jefferies Group LLC lowered its rating on the shares to hold from buy, saying the handset business has a negative value. The stock tumbled 17% on Sept. 20 after the company posted quarterly sales that trailed analysts’ estimates by half and announced 4,500 job cuts.

General Electric Co. advanced 1.2% to $24.29 after winning contracts worth $2.7 billion from a unit of Sonelgaz, Algeria’s state-owned electricity and gas company. GE will supply heavy-duty gas turbines, steam turbines and generators for nine power plants, according to a statement.

Walgreen Co. added 2.3% to $56.77. Morgan Stanley boosted its rating on the stock to overweight from equal weight. The stock slipped 0.8% Sept. 20 after rising in 14 of the previous 15 sessions.

www.bloomberg.com

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