Stocks Take a Negative Route

Updated from 10:30 a.m. EDT

Stocks on Wall Street were tracking into negative territory Tuesday following analyst downgrades of several banking names and economic data that suggest the U.S. housing market remains stagnant.

The Dow Jones Industrial Average was recently down 101 points to 11,409, and the S&P 500 dropped 18 points to 1,249. The Nasdaq dropped 20 points to 2,249.

After Monday's close, a regulatory filing showed Michael Dell, CEO of PC maker Dell (DELL Quote), bought $100 million in the company's stock last week.

Ahead of the new day's trading, Dow Jones Newswires reported that South Korea Development bank, which had earlier been rumored ready to buy a stake in Lehman Brothers (LEH Quote), has ended talks with the struggling brokerage. However, Bloomberg later reported that Korea's Financial Services Commission denied the report. Subsequently, Bloomberg reported that the talks between Lehman and KDB did in fact end.

Whatever really happened, Lehman is trading down some 30%.

Meanwhile, mining company Sasol (SSL Quote) reported that full-year profit rose 32% from a year ago. The company also said it expects continued growth in the year ahead.

Marius Kloppers, CEO of fellow miner BHP Billiton (BHP Quote), said that slowing global demand for commodities will bring shareholders of Rio Tinto (RTP Quote) to support BHP's hostile bid for the company.

Elsewhere, fast-food colossus McDonald's (MCD Quote) announced that its August same-store sales rose 8.5%, up from an 8.1% increase a year ago.

Market analysts' revisions on some stocks' ratings were reflecting market sentiment. Stifel Nicolaus downgraded banking companies TCF Financial (TCB Quote) and BB&T (BBT Quote) to hold from buy and to sell from hold, respectively. Wachovia (WB Quote) also took a hit from Merrill Lynch, which cut the bank to underperform from neutral.