US close: Stocks sharply lower as bank loan fears hit sentiment
By Iain Gilbert
Date: Thursday 16 Oct 2025
(Sharecast News) - Major indices closed sharply lower on Thursday amid fears surrounding bad bank loans.
At the close, the Dow Jones Industrial Average was down 0.65% at 45,952.24, while the S&P 500 shed 0.63% to 6,629.07 and the Nasdaq Composite saw out the session 0.47% softer at 22,562.54.
The Dow closed 301.65 points lower on Thursday, extending modest losses registered in the previous session.
Stocks were higher at the open as tech stocks buoyed markets early on Thursday, with Nvidia and Broadcom both trading higher after chipmaker Taiwan Semiconductor raised its 2025 revenue growth forecast to the mid-30% range, up from around 30%. Taiwan Semiconductor, which manufactures chips for Nvidia, also reiterated plans to invest up to $42bn in capital expenditure by year-end, and reported a near-40% jump in third-quarter profit.
However, stocks reversed earlier gains later in the session, dragged lower by sharp declines in regional banks, with Zions Bancorporation tumbling after booking a large charge linked to troubled loans, while Western Alliance also fell after disclosing alleged borrower fraud.
In terms of earnings, shares in Bank of New York Mellon also traded lower on Thursday despite the financial services group comfortably topping analysts' estimates with record revenues and strong profit growth in the third quarter.
Traders also continued to assess US-Sino trade tensions, which flared up again after Donald Trump threatened a cooking oil trade ban on China, citing reduced soybean purchases linked to earlier tariffs. Trump warned of a potential 100% tariff on Chinese imports in response to new export controls on rare earth minerals, while Treasury Secretary Scott Bessent said price floors across key industries were being considered to counter market manipulation.
Meanwhile, the US government shutdown entered its third week, halting the release of key economic data and leaving traders with limited visibility amid concerns over labour market conditions, consumer impact from tariffs, elevated interest rates and stretched valuations.
On another note, volatility spiked, with the Cboe VIX hitting its highest level since May. Bond yields and the dollar also moved lower, with the 10-year Treasury yield dipping below 4% and the US dollar index down 0.4%.
On the macro front, Manufacturing activity in the Philadelphia region contracted sharply in October, with the Philadelphia Federal Reserve's manufacturing index falling to a six-month low of -12.8, down from 23.2 in September and well below consensus expectations of 10. Shipments dropped 20 points but remained in positive territory at 6.0, while new orders rose six points to 18.2. Employment edged down slightly to 4.6, still indicating modest job gains, but the average workweek shortened to 12.8 from 14.9. Price pressures remained elevated despite some moderation, with the prices paid index rising to 49.2 and prices received climbing to 26.8. Looking ahead, the survey's future activity indicators continued to point to broad expectations for growth over the next six months.
On another note, US homebuilder sentiment rose in October, with the National Association of Home Builders/Wells Fargo housing market index climbing to 37 from 32 in the prior two months, marking a six-month high and beating forecasts of 33. Current sales conditions improved to 38, while sales expectations over the next six months jumped nine points to 54. The gauge for prospective buyer traffic also rose, up four points to 25. Despite the uptick, pricing pressures remained evident, with the survey showing 38% of builders had cut prices in October, with the average reduction rising to 6% - the highest since October 2024.
Reporting by Iain Gilbert at Sharecast.com
Dow Jones - Risers
Salesforce.Com Inc. (CRM) $245.78 3.89%
Caterpillar Inc. (CAT) $541.20 1.34%
Procter & Gamble Co. (PG) $149.38 1.33%
Coca-Cola Co. (KO) $67.57 0.73%
Johnson & Johnson (JNJ) $191.77 0.31%
Walgreens Boots Alliance, Inc. (WBA) $11.98 0.00%
Microsoft Corp. (MSFT) $511.83 0.00%
Dowdupont Inc. (DWDP) $0.00 0.00%
Verizon Communications Inc. (VZ) $40.38 0.00%
McDonald's Corp. (MCD) $305.08 -0.06%
Dow Jones - Fallers
Visa Inc. (V) $335.02 -3.09%
Travelers Company Inc. (TRV) $261.73 -2.87%
Walmart Inc. (WMT) $106.24 -2.56%
JP Morgan Chase & Co. (JPM) $298.50 -2.35%
Nike Inc. (NKE) $66.92 -2.26%
American Express Co. (AXP) $323.26 -2.24%
International Business Machines Corporation (CDI) (IBM) $275.94 -1.71%
Walt Disney Co. (DIS) $109.81 -1.70%
3M Co. (MMM) $151.33 -1.39%
Dow Chemical Co. (DOW) $21.90 -1.37%
S&P 500 - Risers
J.B. Hunt Transport Services Inc. (JBHT) $169.68 22.22%
Micron Technology Inc. (MU) $202.53 5.52%
Newmont Corporation (NEM) $98.13 4.86%
Western Digital Corp. (WDC) $125.95 4.57%
Brown Forman Corp. Class B (BF.B) $28.25 4.03%
Mettler Toledo International (MTD) $1,355.40 3.94%
Salesforce.Com Inc. (CRM) $245.78 3.89%
Illumina Inc. (ILMN) $95.90 3.12%
Oracle Corp. (ORCL) $312.97 3.08%
Seagate Technology Plc (STX) $226.11 3.07%
S&P 500 - Fallers
Apartment Investment & Management Co. (AIV) $5.57 -29.04%
Zions Bancorporation (ZION) $46.95 -13.10%
F5 Inc. (FFIV) $295.46 -10.67%
Jefferies Financial Group Inc. (JEF) $48.84 -10.55%
Hewlett Packard Enterprise (HPE) $22.67 -9.44%
Marsh & McLennan Companies Inc. (MMC) $187.19 -8.17%
Brighthouse Financial, Inc. (BHF) $45.11 -6.53%
Citizens Financial Group, Inc. (CFG) $48.41 -6.36%
Verisk Analytics Inc. (VRSK) $228.93 -6.17%
Comerica Inc. (CMA) $73.82 -6.09%
Nasdaq 100 - Risers
J.B. Hunt Transport Services Inc. (JBHT) $169.68 22.22%
Micron Technology Inc. (MU) $202.53 5.52%
Western Digital Corp. (WDC) $125.95 4.57%
Illumina Inc. (ILMN) $95.90 3.12%
Seagate Technology Plc (STX) $226.11 3.07%
Hologic Inc. (HOLX) $68.50 2.24%
Monster Beverage Corp (MNST) $70.16 2.20%
Starbucks Corp. (SBUX) $84.33 1.77%
Analog Devices Inc. (ADI) $241.66 1.47%
KLA-Tencor Corp. (KLAC) $1,099.91 1.19%
Nasdaq 100 - Fallers
Verisk Analytics Inc. (VRSK) $228.93 -6.17%
American Airlines Group (AAL) $11.90 -4.80%
Charter Communications Inc. (CHTR) $255.23 -3.53%
Workday, Inc. (WDAY) $227.54 -3.08%
Paypal Holdings Inc (PYPL) $66.06 -2.83%
Booking Holdings Inc. (BKNG) $4,950.52 -2.57%
Fiserv Inc. (FI) $118.10 -2.49%
Liberty Global plc Series A (LBTYA) $10.80 -2.44%
Qvc Group Inc Series A (QVCGA) $14.42 -2.44%
Expedia Group Inc. (EXPE) $213.66 -2.18%
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