REFILE-US STOCKS-Wall Street ends lower as coronavirus surge prompts renewed restrictions

(Refiles to fix grammar, paragraph seven)
* Nike falls after surprise quarterly loss
* U.S. banks slip as Fed caps shareholder payout
* Facebook biggest drag on S&P 500
* Indexes fall: Dow 2.84%, S&P 2.42%, Nasdaq 2.59%

By April Joyner
NEW YORK, June 26 (Reuters) - Wall Street's major indexes
tumbled more than 2% on Friday as several U.S. states imposed
business restrictions in response to a surge in coronavirus
cases.
Some U.S. states that were spared the brunt of the initial
coronavirus outbreak or moved early to lift restrictions are
seeing a resurgence in new infections. On Friday, Texas and
Florida ordered bars to close down again. "You're seeing a pretty dramatic increase in cases," said
Kevin Grogan, managing director of investment strategy at
Buckingham Strategic Wealth in St. Louis. "If people start
feeling again like it's not safe to eat out or go shopping, that
could have a really negative impact on the stock market."
A Wall Street Journal report that the Phase 1 U.S.-China
trade deal could be at risk placed additional pressure on U.S.
stocks. According to that report, Chinese officials warned that
"meddling" in Hong Kong and Taiwan could lead Beijing to back
away from its commitment to purchase U.S. farm goods.
"It added another log into the risk aversion fire," said
Edward Moya, senior market analyst at OANDA in New York, of the
report on China.
Among sectors, financial .SPSY , communication services
.SPLRCL and energy .SPNY shares outpaced the broader S&P 500
in declines. S&P 500 bank shares .SPXBK plummeted 6.1% after
the Federal Reserve limited dividend payments and barred share
repurchases until at least the fourth quarter following its
annual stress test. Renewed concerns over the novel coronavirus pandemic have
threatened to derail a strong rally for Wall Street that has
erased much of the S&P 500's steep losses from March. The
benchmark index ended below its 200-day moving average, an
indicator of long-term momentum.
The uptick in coronavirus cases likely triggered a test of
that technical level, said Jim Paulsen, chief investment
strategist at The Leuthold Group in Minneapolis.
The Dow Jones Industrial Average .DJI fell 730.05 points,
or 2.84%, to 25,015.55, the S&P 500 .SPX lost 74.71 points, or
2.42%, to 3,009.05 and the Nasdaq Composite .IXIC dropped
259.78 points, or 2.59%, to 9,757.22.
For the week, the S&P 500 fell 2.87%, the Dow lost 3.31%,
and the Nasdaq shed 1.87%.
Facebook Inc FB.O shares shed 8.3%, weighing the most on
the S&P 500, after Unilever PLC ULVR.L and Verizon
Communications Inc VZ.N joined an advertising boycott that
called out the social media giant for not doing enough to stop
hate speech on its platforms. Nike Inc NKE.N shares dropped 7.6% as the footwear maker,
hurt by store closures due to the pandemic, posted a surprise
quarterly loss. Gap Inc GPS.N shares surged 18.8% after the retail chain
entered a 10-year deal with rapper and fashion designer Kanye
West to create a line of clothing under his Yeezy brand.
Friday also marked the reconstitution of the FTSE Russell
indexes, including the large-cap Russell 1000 .RUI and
small-cap Russell 2000 .RUT . Daily trading volume is often
among its highest levels of the year during the reconstitution,
though volume this year has spiked on several occasions amid
steep market sell-offs.
Volume on U.S. exchanges was 16.43 billion shares, compared
to the 13.44 billion average for the full session over the last
20 trading days.
Declining issues outnumbered advancing ones on the NYSE by a
3.99-to-1 ratio; on Nasdaq, a 3.57-to-1 ratio favored decliners.
The S&P 500 posted five new 52-week highs and no new lows;
the Nasdaq Composite recorded 59 new highs and 28 new lows.