U.S. Stocks Under Pressure; Citigroup Demoted By Goldman
NEW YORK (MarketWatch) -- U.S. stocks slid Monday, with financials under renewed pressure after Citigroup Inc. was downgraded by Goldman Sachs, which envisions more credit-related hits at the banking powerhouse.
"News that Goldman Sachs downgraded Citigroup to sell heightened jitters in stocks, while forecasts of a weak holiday shopping season added to market fears of a U.S. recession down the road," said analysts at Action Economics.
The Dow Jones Industrial Average fell 98.8 points to 13,077.9, with 23 of its 30 components trading lower, with Citigroup fronting the Dow's decline, its stock off 4.2%.
The bank was downgrade to sell from neutral by Goldman Sachs, with the broker seeing up to $15 billion in write-downs from collateralized debt obligations during the next two quarters. .
The S&P 500 fell 11.75 points to 1,446.99, while the Nasdaq Composite declined 15.52 points to 2,621.72.
Crude-oil futures gained in early trade on the New York Mercantile Exchange, with the contract for January delivery up 37 cents to $94.19 a barrel.
At a rare summit, the Organization of Petroleum Exporting Countries said it would not change output. .
The dollar dropped against the yen but rose against the euro.
Gold futures lost $3.50 to $783.50. .
Volume on the New York Stock Exchange came to 165 million, and declining stocks topped those advancing nearly 5 to 1. On the Nasdaq, more than 243 million shares were traded, and declining stocks outpaced advancers nearly 4 to 1.
Credit loses
Reinsurance company Swiss Re on Monday reported $1.1 billion in subprime-related losses.
Stricken mortgage bank Northern Rock Plc on Monday warned that takeover proposals received so far are "materially below" its closing price on Friday. .
Home improvement retailer Lowe's Cos. reported third-quarter profits fell 10%, partly due to the troubled housing market.
Xerox Corp. declared its first dividend in six years, while backing its view for 2007 earnings per share.
Overseas
In Europe, stocks lost ground, with the insurance sector under pressure. .
In Asia, several markets came off their day's highs to end lower after a volatile session. .
By Kate Gibson