Battered Bank Stocks Lead the Way Down
|
TOOLBOX
   Resize
COMMENT
 Discussion Policy
 CLOSE
Comments that include profanity or personal attacks or other inappropriate comments or material will be removed from the site. Additionally, entries that are unsigned or contain "signatures" by someone other than the actual author will be removed. Finally, we will take steps to block users who violate any of our posting standards, terms of use or privacy policies or any other policies governing this site. Please review the full rules governing commentaries and discussions. You are fully responsible for the content that you post.
Who's Blogging  |
U.S. stocks declined, sending the Dow Jones industrial average to its lowest level in six years as economic reports raised concern that government efforts won't curb the recession.
Citigroup and Bank of America tumbled more than 31 percent, pushing financial shares in the Standard & Poor's 500-stock index to the lowest level since 1994, on speculation that the U.S. government may take them over. Deere and Caterpillar helped lead industrial stocks to the steepest declines in the S&P 500 on a record contraction in New York manufacturing.
"The market has been having another panic attack," Richard A. Weiss, chief investment officer at City National Bank in Beverly Hills, Calif., said in a Bloomberg Television interview. "Ultimately, we're going to be seeing some of the buys of the century in equities likely this year, but maybe it's a little too early right now."
The S&P 500 fell 6.9 percent, to 770.05, extending its worst-ever decline to start a year to 15 percent. The Dow average retreated 484.74 points, or 6.2 percent, to 7365.67. The Nasdaq composite index lost 6.1 percent, to 1441.23.
Stocks fell as President Obama failed to assuage investors with his signing of a $787 billion economic stimulus plan that combines tax breaks and government spending aimed at reviving the moribund U.S. economy. Shares of home builders and banks retreated even after Obama announced a plan to stem home foreclosures.
The S&P 500 Financials Index lost 16 percent. It's the worst performer of 10 industry sectors in the S&P 500 this year, having fallen 41 percent.
Hewlett-Packard, the world's biggest personal-computer maker, tumbled 13 percent, to $31.24, as it cut its profit forecast and said PC demand will wane as businesses reduce spending and the economy shows no improvement this year.
General Motors plunged 29 percent, to $1.77, as the automaker said it needs as much as $16.6 billion in new U.S. loans to stay in business.
Wal-Mart Stores was the only stock to advance among the 30 in the Dow average, rising 7.5 percent, to $50.02. The world's largest retailer reported fourth-quarter profit that fell less than analysts estimated as discounts on groceries and drugs attracted customers.
The Treasury will auction $31 billion of three-month bills and $30 billion of six-month bills on Monday. They yielded 0.28 percent and 0.48 percent, respectively, in when-issued trading. One-month bills will be sold Tuesday.
-- Bloomberg News
