U.S. Stocks Begin Lower In Looking To Alcoa's Earnings

NEW YORK (MarketWatch) - U.S. stocks opened lower Monday, with investors stepping tentatively before Alcoa Inc. releases its fourth-quarter results in the unofficial start of what was expected to be an especially dreary earnings season.

Materials, energy and financial shares led the broad sector declines.

The Dow Jones Industrial Average shed 56.95 points to 8,552.23, with 23 of its 30 components trading lower.

The S&P 500 fell 8.91 points to 881.44, and the Nasdaq Composite declined 13.06 points to 1,558.53.

Deutsche Bank downgraded Alcoa to sell from hold in the wake of last week's announced cuts in production and employees by the aluminum giant.

Alcoa reports its earnings after the market closes, with analysts expecting the company to report a loss of 10 cents a share.

Intel Corp. reports its results on Thursday, with the chip maker and Wal-Mart Stores Inc. among the companies offering bleak forecasts last week.

Citigroup Inc. shares fell 8.6% with the banking powerhouse reportedly near a deal to combine its brokerage business with Morgan Stanley . Shares of Morgan Stanley led all S&P 500 financial stock gainers, climbing 8%.

Volume on the New York Stock Exchange topped 101 million, and decliners outpaced advancers more than 2 to 1. On the Nasdaq, nearly 57 million shares traded, and decliners routed advancers less than 2 to 1.

Crude-oil futures fell, lately down $2.07 at $38.76 a barrel.

On Friday, stocks fell for a third consecutive day after the government reported the nation's unemployment rate climbed to 7.2% in December from 6.8% the prior month.

By Kate Gibson