By Rodrigo Campos
NEW YORK (Reuters) - Stocks fell on Thursday on worries the economic recovery was slowing, with banks also pressured by congressional negotiations on a financial regulatory overhaul.
Democrats, in charge of hammering out a final bill, appeared likely to force through restrictions on banks' trading and investment activities that could crimp profits.
Dow component JPMorgan Chase & Co
A drop in initial jobless claims and a rise in a gauge of long-lasting manufactured goods failed to offset recent weak economic data, and the Federal Reserve on Wednesday gave a subdued assessment about the economy's recovery.
Retailer stocks were among the top decliners, with JC Penney
"There hasn't been too much good news, from housing and all the way down this week," said Alan Lancz, president at Alan B. Lancz & Associates in Toledo, Ohio.
"There are clouds on the horizon with the financial regulatory reform and more talk on that front hurting banks."
The Dow Jones industrial average <.DJI> dropped 49.73 points, or 0.48 percent, to 10,248.71. The Standard & Poor's 500 Index <.SPX> fell 7.31 points, or 0.67 percent, to 1,084.73. The Nasdaq Composite Index <.IXIC> lost 9.06 points, or 0.40 percent, to 2,245.17.
In bearish technical signs, the S&P opened below its 14-day moving average and breached the 1,083 level, a key retracement of the slide from its 2010 high in April to the year's low on May 25.
Pfizer Inc
On the upside, homebuilder shares rose with Lennar Corp
The Dow Jones home construction index <.DJUSHB> gained 1.2 percent.
(Editing by Kenneth Barry)