U.S. stocks extend losses on renewed regional bank turmoil

NEW YORK, May 4 (Xinhua) -- U.S. stocks dropped on Thursday due to concerns over the failure of more regional banks in the United States.

The Dow Jones Industrial Average decreased 286.50 points, or 0.86 percent, to 33,127.74. The S&P 500 fell 29.53 points, or 0.72 percent, to 4,061.22. The Nasdaq Composite Index decreased 58.93 points, or 0.49 percent, to 11,966.40.

Nine of the 11 primary S&P 500 sectors ended in red, with financials and communication services sectors leading the laggards down 1.29 percent and 1.26 percent, respectively. Meanwhile, real estate and utilities sector bucked the trend, up 0.92 percent and 0.73 percent, respectively.

Investors focused on the most vulnerable among U.S. regional banks by staging another round of selling.

PacWest Bancorp, a regional bank based in Los Angeles, has explored strategic asset sales and this planned sale remains on track, said the bank in a statement on Thursday.

PacWest Bancorp added it has not experienced out-of-the-ordinary deposit flows following the sale of First Republic Bank and other news.

The shares of PacWest Bancorp and Western Alliance Bancorp. tanked 50.62 percent and 38.45 percent on Thursday, respectively.

The U.S. banking sector is in shambles as regional banks get crushed while expectations remain high that there will be more banking failures, said Edward Moya, senior market analyst at OANDA, a supplier of online multi-asset trading services.

"Selling financials is an easy trade as interest rates are too high and will probably remain there thanks to the Fed, which will also continue to drive financial stability concerns," said Moya.

Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), warned Thursday that in times of increased volatility and uncertainty, the SEC is particularly focused on identifying and prosecuting any form of misconduct that might threaten investors, capital formation, or the markets more broadly.

Moreover, U.S. new jobless claims increased to 242,000 in the week ending April 29, higher than economists' expectation of 238,000 and 229,000 in the previous week, according to data issued by the U.S. Department of Labor on Thursday.