U.S. Stocks Under Pressure; Dow Flirts With 13,000 Level
NEW YORK (MarketWatch) -- U.S. stocks fell further Monday, with the Dow industrials down more than 150 points, after Goldman Sachs downgraded Citigroup Inc., saying it 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.
After falling below the 13,000 psychological level earlier on, the Dow Jones Industrial Average was more recently off 160.6 points, or 1.2%, at 13,016.2, with 25 of its 30 components trading lower/
Citigroup fronting the Dow's decline, its stock off 4.9%.
The bank was downgraded 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 downgrade was one of multiple developments related to the ongoing credit crunch. .
The S&P 500 fell 21.07 points, or 1.4%, to 1,437.67, while the Nasdaq Composite declined 36.67 points, or 1.4%, to 2,600.57.
On the New York Mercantile Exchange, crude-oil futures fell, with the contract for January delivery off 35 cents to $93.49 a barrel.
At a rare summit, the Organization of Petroleum Exporting Countries said it would not change output. .
Treasurys posted mild gains , while the dollar was slightly higher against most major counterparts, but fell modestly against the yen. .
Gold futures fell sharply after losing more than $47 the prior week, with the contract for December delivery off $10.1 at $776.9. .
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Volume on the New York Stock Exchange came to 487 million, and declining stocks topped those advancing 5 to 1. On the Nasdaq, more than 669 million shares were traded, and declining stocks outpaced advancers more than 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 for the third session in a row, 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