Stocks Mired in Losses

Over the weekend, another report by the Journal said that GM was exploring other plans to shore up its balance sheet, including offering its debt holders the opportunity to swap credit for equity.

As the carmakers faced dire circumstances, the United Auto Workers called for Congressional aid for the Big Three.

Fellow automaker Ford (F Quote) said it was considering a possible sale of its Volvo brand. The move comes amid a decline in global auto demand and Ford's efforts to bolster its balance sheet, the company said.

Hoping to reach a bailout deal, the automakers are expected to present before Congress on Tuesday plans for revamped business models and improved long-term viability.

The Journal also reported that Delta Air Lines (DAL Quote) would scale back its orders for Boeing's (BA Quote) new 787 Dreamliner and instead add to its orders for the long-range 777-200LR.

In the financial sector, Citigroup (C Quote) bought a highway business from Spanish construction firm Sacyr Vallehermoso for $10 billion. Media reports also suggested Citi would sell its Japanese trust banking unit for $416.7 million.

Meanwhile, Morgan Stanley (MS Quote) may buy regional banks to expand its retail banking footprint after becoming a bank holding company in September, according to a Journal report.

AIG (AIG Quote) announced it was selling its Switzerland-based AIG Private Bank wealth management business to Abu Dhabi firm Aabar Investments

Beyond the financial sector, Johnson & Johnson (JNJ Quote), meanwhile, said it would buy breast-implant maker Mentor (MNT Quote) for $1.07 billion.

Gendreau of ING said M&A activity had fallen off as capital and credit, which had supported deal brokering, became increasingly scarce this year. On the other hand, "With all of these extreme market movements, there have to be some mispricings."

As to analyst actions, Occidental (OXY Quote) garnered an equal-weight rating at Morgan Stanley. Insurer Prudential (PRU Quote) was upgraded to buy from hold at Citigroup on valuation.

Microsoft (MSFT Quote), meanwhile, suffered a reduced price target at Morgan Stanley.