Wall Street was on track to end the week lower on Friday as the rising cost of insuring Spanish debt against default increased worries about Europe's financial health, sparking a selloff in financial stocks. In early afternoon trading, the S&P 500 was down 1.4 percent for the week so far - a drop that would represent the benchmark index's worst weekly percentage decline of the year - if the market closes at or near current levels.
The S&P financial sector index fell 1.7 percent despite earnings from J.P. Morgan Chase & Co and Wells Fargo & Co that beat Wall Street's expectations. J.P. Morgan shares slid 2.7 percent to $43.64. Wells Fargo shares fell 2.2 percent to $33.27.
"There are so many things playing into the decline today and although I am not turning bearish, I am telling our clients that they should take a more defensive stance," said Randy Frederick, managing director of active trading and derivatives at Charles Schwab in Austin, Texas.
The Dow Jones industrial average lost 52.22 points, or 0.40 percent, to 12,934.36. The Standard & Poor's 500 Index fell 8.87 points, or 0.64 percent, to 1,378.70. The Nasdaq Composite slid 27.96 points, or 0.92 percent, to 3,027.59. Weighing on the Nasdaq, Apple Inc shares dropped 2.1 percent to $609.87.
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