U.S. Stocks Drop After Bernanke Warns Inflation Is Fed Priority

une 4 (Bloomberg) -- U.S. stocks fell, sending bank shares to their lowest level in eight years, as Federal Reserve Chairman Ben S. Bernanke's warning that inflation is too high spurred speculation policy makers will raise interest rates.

Wachovia Corp. led 20 of 23 companies in the Standard & Poor's 500 Banks Index lower after Bernanke said price stability is the Fed's ``top priority.'' MBIA Inc. and Ambac Financial Group Inc., the world's largest bond insurers, tumbled as Moody's Investors Service said it may cut their credit ratings. Intel Corp. and Cisco Systems Inc. gained, sending the Nasdaq Composite Index to its biggest advance in a week, as an industry report showed stronger-than-forecast growth at service companies.

Source: Bloomberg

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