Updated from 9:04 a.m. EDT
Stocks on Wall Street opened Tuesday to the downside, as bad news from financial firms weighed on sentiment.
Dow Jones Industrial Average
dropped 74 points to 11,708, and the
lost 6.5 points to 1299. The
slipped 12 points 2428.
On the corporate front, a spate of negative headlines struck at several big financial names. Moody's downgraded
debt rating after the close Monday, to A1 from Aa3, saying that Morgan did a poor job of managing risk during the credit crisis.
Offering further credit-related headwinds, Standard & Poor's cut its ratings on holdings of mortgage firms
, a move that could hurt the companies' efforts to raise additional capital.
Elsewhere in the financial space,
said it would cut 600 more jobs and revised its second-quarter loss to $9.11 billion from $8.86 billion. The bank said it was increasing its legal reserves as it discusses a possible settlement with the government over its dealings in auction-rate securities.
said in a filing with the
Securities and Exchange Commission
that it was writing down $1.5 billion in mortgage-related assets.
Traders will also be focusing on Swiss bank
$331 million second-quarter loss. The company said it would split its investment-banking business from its wealth-management segment to quell customer concerns.
Advanced Micro Devices
announced after the market close Monday that it would release a new graphics card, which it said is the world's fastest.
In retail, department-store operator
announced a year-over-year increase in profits and raised its earnings expectations for the full year.
Elsewhere, biotechnology firm
won government approval to market its HIV drug Viread for chronic hepatitis B patients.
Meanwhile, billionaire investor Carl Icahn increased his stake in
to 6% from 4.3%. Icahn has been seeking a sale of the biotech company.
As for analyst actions, UBS downgraded fast-food seller and member of the
Dow Jones Industrial Average
to neutral from buy.
, on the other hand, caught a Deutsche Bank downgrade to hold from buy.
The airline sector also caught a series of nods from JP Morgan, which slapped overweight stickers on American Airlines' parent
got a JPMorgan bump to neutral from underweight.
Moving over to commodities, crude oil was lately rising $1.41 to $115.86. Oil company
announced it was shutting down two oil and gas pipelines that run through Georgia to forestall potential damage related to Georgia's conflict with Russia. Russia announced today that it was ceasing its operations against Georgia, but did not announce a withdrawal. Gold was gaining $1.80 to $830.10.
U.S. Treasuries were edging upward in price. The 10-year note was adding 16/32, yielding 3.93%, and the 30-year was up 26/32 to yield 4.55%. The dollar was falling against the euro and the yen, but edging up vs. the pound.
In economic data, the June trade deficit was revised down to $56.8 billion from $59.8 billion, a smaller deficit than the consensus estimate of $61.9 billion. A large increase in exports helped to counteract high petroleum imports. A little later, the U.S. Treasury will announce its budget for July.
Abroad, European markets were mixed, while Asian exchanges lost ground. The FTSE in London was working higher, while the DAX in Frankfurt, the Nikkei in Tokyo and the Hang Seng in Hong Kong were logging declines.