Premarket action on Friday had the three major U.S. indexes trading lower. The Dow Jones industrials were down 0.90%, the S&P 500 down 0.72% and the Nasdaq 0.38% lower.

Nine of 11 market sectors closed lower Thursday. Energy (−1.36%) and financials (−0.66%) fell the most. Communications services (1.83%) and technology (1.66%) posted the day’s only gains. The Dow closed up 0.23%, the S&P 500 up 0.3% and the Nasdaq up 1.01% on Thursday.

Two-year Treasuries dropped 20 basis points to end the day at 3.76%, and 10-year notes fell 10 basis points to close at 3.38%. In Friday’s premarket, two-year notes were trading at around 3.62% and 10-year notes at about 3.3%.

Thursday’s trading volume was well below the five-day average. New York Stock Exchange losers outpaced winners by 1,931 to 1,080, while Nasdaq decliners led advancers by about 8 to 7.

Netflix Inc. (NASDAQ: NFLX) rose 9.01% to lead Thursday’s S&P 500 winners. Bloomberg reported that the company’s ad-supported tier added more than 1 million subscribers in the first two months of the year. That number met the promises Netflix made to advertisers. Even better, the cheaper ad-supported subscription has not cannibalized the streaming giant’s higher-priced, ad-free subscriber numbers. Netflix has guided free cash flow for this year to at least $3 billion, almost double last year’s $1.6 billion in free cash flow.

The nation’s regional banks had another difficult day Thursday. Zions Bancorp. (NASDAQ: ZION) dropped 8.86% to post the biggest loss among S&P 500 stocks. Comerica Inc. (NYSE: CMA) dropped 8.58%, KeyCorp (NYSE: KEY) lost 6.47% and First Republic Bank (NYSE: FRC) dumped 6.00%.

Treasury Secretary Janet Yellen said Thursday that federal regulators are ready to do whatever is necessary to backstop bank deposits. On Wednesday, her remarks following the FOMC meeting suggested that the government was not planning to offer “blanket” insurance to U.S. banks.

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That got the day off on the right foot, but Deutsche Bank AG (NYSE: DB) is reported to be under investigation by the U.S. Department of Justice for helping Russian oligarchs evade sanctions imposed following Russia’s invasion of Ukraine a year ago. Deutsche Bank shares dropped 6.13% on Thursday and traded down more than 10% in Friday’s premarket session. Shares of the German bank traded down 14% in the late morning in Europe.

Short seller Hindenburg Research issued a report on Block Inc. (NYSE: SQ) accusing the Jack Dorsey-led firm once known as Square of having “systematically taken advantage of the demographics it claims to be helping.” Block’s stock dropped nearly 15% on Thursday and traded down another 2.5% in Friday’s premarket.

Hindenburg also charges Block with overstating user counts, citing former Block employees who estimated that 40% to 75% of the company’s accounts were “fake, involved in fraud, or were additional accounts tied to a single individual.”

The short seller also cites a 2021 report by Sarah Crowe, senior director at Polaris, a nonprofit group working to stop sex trafficking, stating that “when it comes to sex trafficking in the U.S., by far the most commonly referenced platform is [Block’s] Cash App.” Block replied to the charge, saying that it rejects all trafficking-related payments and other crimes, and employs teams to monitor suspicious transactions. Neither Block nor Dorsey has yet responded to Hindenburg’s report.

Judging by its purchase of 338,000 shares of Block on Thursday, Cathie Wood’s Ark Invest is unmoved by Hindenburg’s report. Block is among the flagship ARK Innovation ETF’s top 10 holdings, comprising 5.62% of the fund’s portfolio.

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