* Bank stocks fall; gold and VIX shoot up
* Target up on smaller drop in comparable sales
* Indexes down: Dow 0.89 pct, S&P 0.86 pct, Nasdaq 1 pct
(Updates to open)
By Yashaswini Swamynathan
May 17 U.S. stocks were sharply lower on
Wednesday after reports of a leaked memo by former FBI chief
James Comey caused alarm on Capitol Hill, raising questions
about whether President Donald Trump tried to interfere with a
Trump asked Comey to end a probe into former National
Security Adviser Michael Flynn's ties with Russia, according to
The latest development could distract Trump from pursuing
his proposed policies such as tax cuts and simpler bank
regulations, which have underpinned a record-setting rally on
The news comes on the heels of a tumultuous week at the
White House when Trump unexpectedly fired Comey and then
disclosed classified information to Russia's foreign minister
about a planned Islamic State operation.
Bank stocks, which have outperformed in the post-election
rally, were the worst hit. The S&P 500 financial sector
dropped 1.67 percent, led by losses in Bank of America
Goldman Sachs was the biggest drag on the Dow.
The dollar index sank on Wednesday, erasing all of
the gains inspired by Trump's business-friendly stance after his
November election victory. The euro hit its highest level
since Nov. 7, while prices of gold hit a one-month high.
The VIX, Wall Street's "fear gauge", shot up to 12.8
points and was on track for its biggest one-day percentage
increase since August.
"Equity investors are beginning to display concerns over the
domestic political situation that is not likely to suddenly
vanish," Peter Cardillo, chief market economist at First
Standard Financial wrote.
"The equity markets have ignored the noise out of
Washington. However, we think the situation is likely to change
as this crisis leads to an interruption of the pro-growth White
House agenda, deflating the Hope Rally."
At 9:52 a.m. ET (1352 GMT), the Dow Jones Industrial Average
was down 185.86 points, or 0.89 percent, at 20,793.89,
the S&P 500 was down 20.52 points, or 0.86 percent, at
2,380.15 and the Nasdaq Composite index was down 61.63
points, or 1 percent, at 6,108.24.
Eight of the 11 major S&P 500 sectors were lower.
Traditionally defensive sectors utilities,
consumer staples and real estate were
Target was up 4.8 percent at $57.10 after the
big-box retailer reported a smaller-than-expected drop in
AbbVie slipped 2.4 percent to $65.25 after Coherus
BioSciences received a favorable patent ruling against
AbbVie's Humira drug. Coherus shares rose nearly 7 percent to
Declining issues outnumbered advancers on the NYSE by 2,213
to 529. On the Nasdaq, 2,126 issues fell and 379 advanced.
The S&P 500 index showed three new 52-week highs and 14 new
lows, while the Nasdaq recorded 15 new highs and 44 new lows.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by