* Wells Fargo results weigh on financials, JPMorgan dips
* AMD slumps after revenue warning
* Consumer sentiment data beats expectations
* Dow dips 0.1 pct, S&P 500 off 0.4 pct, Nasdaq down 0.2 pct
By Atossa Araxia Abrahamian
NEW YORK, Oct 12 (Reuters) - U.S. stocks fell on Friday, led
by financial stocks, after Wells Fargo & Co said
quarterly revenue fell short of expectations.
Shares of Wells Fargo shed 3.5 percent to $33.96 after
reporting a quarterly revenue of $21.2 billion, which missed
analysts' forecasts, even as it earned a record profit.
The shortfall prompted investors to sell other bank shares,
including those of JPMorgan Chase & Co, which also
reported a record profit for the quarter.
JPMorgan slid 1.6 percent to $41.40, while the KBW Bank index
lost 2.63 percent.
Wells Fargo was hurt by a lower net interest margin - the
difference between what it pays on deposits and makes on loans -
and that margin could narrow further as the Federal Reserve
keeps interest rates ultra low.
"A drop in interest margins suggests that the Federal
Reserve's lower interest rates are going to negatively impact
bank profitability in the foreseeable future," said Kent
Engelke, chief economic strategist at Capitol Securities
Management in Richmond, Virginia.
Indeed, expectations are low in general for the S&P 500
companies' quarterly earnings. Overall, earnings are expected to
fall 3 percent from a year ago, compared with a 2.1 percent drop
estimated at the start of the month, according to Thomson
The market drew little support from the Thomson
Reuters/University of Michigan's preliminary October reading on
consumer sentiment, which rose to 83.1, well above a forecast
"We trade on the data and the market is suggesting it's not
as strong as it looks," said Engelke. "If the economy was as
strong as suggested by the data, equities would be up and
the bond market would be traded a lot as well."
Despite several encouraging data points this week, the
benchmark S&P index has shed 2.2 percent in the week so far and
is on track for its worst weekly performance since it fell 3
percent in the week ended June 1.
The Dow Jones industrial average was down 15.15
points, or 0.11 percent, at 13,311.24. The Standard & Poor's 500
Index dipped 5.31 points, or 0.37 percent, to 1,427.53.
The Nasdaq Composite Index was down 5.50 points, or 0.18
percent, at 3,043.91.
Advanced Micro Devices Inc fell 10.4 percent to
$2.86 a day after the chipmaker said its third-quarter revenue
probably fell 10 percent from the previous quarter as a weak
global economy and a growing preference for tablets slams the PC
U.S.-listed shares of STMicroelectronics
shot up 7.1 percent to $6.07 after Bloomberg reported Europe's
top semiconductor maker was considering a breakup that could
lead to the sale of its struggling mobile-phone chip business.
The U.S. Commerce Department said its core Producer Price
Index, which excludes volatile food and energy costs, was flat
in September, compared with August.