U.S. Stocks Down As Citibank Plans 50,000 Job Cuts

NEW YORK (MarketWatch) -- U.S. stocks on Monday scaled back declines after a two-week losing streak as Citigroup Inc. prepared to slash 50,000 jobs and as Japan slipped into recession, heightening investors' worry about the troubled global economy.

After sliding four of the last five trading days, the Dow Jones Industrial Average succumbed again, falling more than 200 points before drastically scaling back on early declines.

The Dow was lately off 32.66 points at 8,464.65, with aluminum producer Alcoa Inc. bleeding the most, off 6.5%.

Shares of Citigroup declined 1% after the bank early Monday said it would cut about 50,000 jobs in the latest and most dramatic round of layoffs to date in the battered financial sector. .

Twelve of the blue-chip benchmark's 30 components pulled into positive turf, with General Motors Corp. up the most, gaining 11.6%. The automaker -- looking for a government bailout from Washington -- said it would raise $232 million by selling a 3% stake in Japan's Suzuki Motor Corp. .

The S&P 500 shed 3.36 points to 869.93, while the Nasdaq Composite lost 7.19 points to 1,509.66.

Financials, information technology and materials led declines among the S&P's 10 industry groups. Energy and consumer staples fronted the limited gains.

"The weekend saw the [Group of 20] meeting in Washington, with not much coming out in any statement giving the markets a sense of accomplishment," said Thomas di Galoma, head of Treasury trading at Jefferies & Co.

"If there was anything emphasized, it was that all countries were being asked to refrain from any sort of protection policies that would put further stresses on a global economic slowdown," said di Galoma.

On the New York Mercantile Exchange, crude-oil futures for December delivery fell 26 cents to $56.78 a barrel, while gold futures gained 60 cents to $743.1 an ounce.

Volume on the New York Stock Exchange neared 419 million, with decliners overtaking advancers 2 to 1. On the Nasdaq, 277 million shares traded, and decliners topped advancers nearly 2 to 1.

Targeted

Target Corp. fell 0.4% after the discount retailer reported fiscal third-quarter profit dropped 24% and said it would temporarily suspend its share-repurchase plan. .

Shares of Lowe's Cos. gained 8.4% after the home-improvement retailer cut its profit forecast for the year. .

A flurry of upgrades supported Nokia Corp. , shares of which traded up 2.1% after a majority of analysts said their concerns for the handset maker are now priced into the market.

Ahead of the opening bell, the National Association for Business Economics said the United States is in for a prolonged recession that would likely drag into 2009. .

And, the New York Federal Reserve reported manufacturing activity in its region fell to a record low in November.

Separately, the Federal Reserve reported output of the nation's factories, mines and utilities rebounded a bit in October after September's steep weather-related slump. .

In regulatory action, the Securities and Exchange Commission charged Dallas Mavericks owner Mark Cuban with insider trading, alleging Cuban in June 2004 sold 600,000 shares of Mamma.com on inside information.

Overseas, Japan's economy contracted in the third quarter, propelling the nation into its first recession since 2001.

Asian markets ended mixed, with Japanese stocks erasing early declines as investors brushed off news that the country had slid into recession.

British banks led another downturn in London, with the FTSE 100 index off 83.7 points to 4,149.28. .

By Kate Gibson