* J.C. Penney down on weak same-store sales
* GE falls after Deutsche Bank downgrades to "sell"
* S&P 500 set to end week at a loss
* Indexes: Dow -0.20 pct, S&P -0.23 pct, Nasdaq +0.03 pct
(Updates to afternoon)
By Noel Randewich
May 12 Wall Street fell on Friday and was on
track to end the week lower as tepid economic data weighed on
banks and worries deepened over Nordstrom and other
A risk-off sentiment gripped Wall Street this week after
President Donald Trump unexpectedly fired his FBI chief, the
potential fallout from which could delay Trump's pro-growth
goals to cut taxes and boost spending on infrastructure.
Soft retail sales and monthly inflation data on Friday
raised concerns about slow economic growth and questions about
whether the Federal Reserve could maintain its hawkish outlook
for interest rates this year.
Federal funds futures implied a 49-percent chance of two
more rate hikes this year, compared with 54 percent shortly
before the release of the data, CME Group's FedWatch tool
Banks, which typically benefit from higher interest rates,
dragged on the S&P 500 and Dow Jones Industrial Average. The S&P
500 financial sector fell 0.6 percent, while industrials
were off 0.8 percent.
Department stores faced serious pressure for a second
straight day after J.C. Penney reported
lower-than-expected comparable-store sales, sending its shares
down 14 percent.
Nordstrom dropped 10 percent after weak quarterly
Macy's fell 2.4 percent, bringing its loss to more
than 18 percent in the past two sessions following its dismal
The less-than-expected 0.4 percent month-over-month increase
in April retail sales stirred fears about the retail sector as
well as the economy.
"The numbers were light again, people don't seem to be
spending money despite employment and income numbers being good.
It's concerning," said Stephen Massocca, Senior Vice President
at Wedbush Securities in San Francisco.
At 2:25 pm ET, the Dow Jones Industrial Average was
down 0.2 percent to 20,878.36 points and the S&P 500 had
lost 0.23 percent to 2,388.83.
The Nasdaq Composite edged up 0.05 percent to
GE was the top percentage loser on the Dow, down 3.37
percent after Deutsche Bank downgraded its shares to "sell" from
Declining issues outnumbered advancing ones on the NYSE by a
1.32-to-1 ratio; on Nasdaq, a 1.38-to-1 ratio favored decliners.
The S&P 500 posted 28 new 52-week highs and 11 new lows; the
Nasdaq Composite recorded 77 new highs and 58 new lows.
(Additional reporting by Yashaswini Swamynathan in Bengaluru;
Editing by Nick Zieminski)