Stocks close lower Tuesday as investors’ bank fears return, Dow sheds more than 300 points: Live updates

Shares of First Republic Bank tumbled more than 49% after the regional bank posted its latest quarterly results, saying late Monday that deposits dropped 40% to $104.5 billion in the first quarter but have since stabilized. First Republic will also be trimming expenses, including slashing headcount by 20% to 25% in the second quarter. Bloomberg News reported Tuesday that the bank was trying to sell as much as $100 billion of loans and securities to restructure its balance sheet.

The regional bank has been closely watched after investors grew concerned it could face the same fate as Silicon Valley Bank and Signature Bank, whose closures set off an industry crisis last month. First Republic shares have collapsed more than 93% so far this year.

Both the SPDR S&P Regional Banking ETF (KRE) and SPDR S&P Bank ETF (KBE) lost more than 4% and 3%, respectively, as financials weighed on the market. Western Alliance Bancorp slid 5.6%, and PacWest dropped 8.9%. Charles Schwab shed almost 4%. The market fell in sympathy as First Republic shares notched new lows in afternoon trading.

“For the first time since this earnings season has started, we’ve actually seen the market react,” said Art Hogan, chief market strategist at B. Riley Wealth Management. “There’s been a built up, or pent up, selling reaction to earnings that are just OK, but not great. And today the floodgates seemed to have opened — and once that started, nobody seems to want to get in the way.”

Traders also fretted over a disappointing earnings report from UPS, which dropped about 10% after the company missed expectations and management said sales volumes were — and should continue to be — under pressure. PepsiCo, on the other hand, rose 2.3% on better-than-expected numbers.

Microsoft and Alphabet are slated to report Tuesday after the bell, the first of multiple Big Tech names on the earnings schedule this week. But those stocks could struggle, according to Jay Hatfield of Infrastructure Capital Management, after rallying earlier this year

Alphabet shares fell 2% ahead of the Google-parent’s earnings after the market closes. The company has been on an earnings cold streak, missing Wall Street estimates the last four quarters, according to Bespoke Investment Group.

“Tech isn’t working as a ballast because it ran up so much and because we’re getting close to earnings,” Hatfield said. “The rubber is hitting the road, so those companies have to do quite well to justify it.”

— CNBC’s Jesse Pound contributed reporting

Correction: A previous version misstated when Amazon reports earnings.