Wall Street Slips From Gains

Stocks in New York back away from early gains as enthusiasm over new initiatives at Citigroup and Bank of America fade.
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Updated from 9:45 a.m. EST

Stocks in New York reversed from early gains midday Friday as investors took in more fourth-quarter earnings reports and some big changes in the banking sector.

The

Dow Jones Industrial Average

was down 90 points at 8122, and the

S&P 500

slipped 11 points to 832. The

Nasdaq

fell 19 points to 1492.

In Treasuries, the 10-year note was recently down 1 10/32 to yield 2.3%, the 30-year was up 2 09/32, yielding 3%.

In the latest news,

Circuit City

(CC) - Get Report

said it will liquidate. The move will eventually add another 35,000 employees to the already staggering unemployment figures stemming from the economic downturn.

The Dow fell below 8000 on Thursday -- led by declines in

Citigroup

(C) - Get Report

and

Bank of America

(BAC) - Get Report

-- before rebounding to close in slightly positive territory. Investors, skeptical about the banks' multibillion-dollar losses and inability to function without more help, shook off those anxieties early Friday however.

Citigroup

reported a fourth-quarter loss of $8.29 billion early Friday and said it will split its operations in two, separating its traditional banking business from its riskier assets. The disassembly follows a deal earlier in the week to combine its brokerage business with

Morgan Stanley

(MS) - Get Report

.

Meanwhile,

Bank of America

sprung early results on investors. The bank lost $2.39 billion, or 48 cents a share, in the fourth quarter. The behemoth bank, which has struggled to swallow the acquisitions of Merrill Lynch and Countrywide, will now receive an additional $20 billion in support from the government. In a similar fashion to the deal the government struck with Citi last fall, the bank will guarantee to cover up to $118 billion in losses on loans and securities backed by residential and commercial real estate.

Also Friday, Switzerland's

UBS

(UBS) - Get Report

said it is selling parts of its

commodities business

to

Barclays

(BCS) - Get Report

for a yet-to-be-determined sum.

In other earnings,

Sony Ericsson

reported a fourth-quarter loss of $245 million, as consumer demand slacked.

The Labor Department said Friday that consumer prices dropped by 0.7% in December, a slightly less severe drop than the 0.9% decline economists expected. For the year, consumer prices nudged up 0.1%, the smallest change since 1954, when consumer prices fell by 0.7%. Prices rose 4.1% in 2007. The year-over-year change occurred because of the sizable declines in energy prices in recent months.

Oil prices

were rising 15 cents to $35.55 a barrel after a multiday tumble that took prices below $35 earlier in the week. In a report on Friday, the International Energy Agency predicted that the worsening global economy will leave demand at 85.3 million barrels a day, a 0.6% decline from 2008.

The IEA also issued a statement on Friday with regard to the Russia/Ukraine gas dispute. The agency said it "is deeply concerned about the lack of ability of both Gazprom and Naftogaz of Ukraine to resume delivery of gas to Europe, despite an agreement to do so brokered by the European Union and signed by all parties last Monday."

Many consumers have been left without gas for two weeks because of the disagreement. "Industries are being closed at a time of already poor economic conditions; domestic and other consumers are suffering real hardship," wrote the EIA.

In other commodities, gold was rising $23.80 to $831.10 an ounce.

The dollar was weaker against the euro, pound and stronger against the yen.

Overseas, the FTSE in London and the DAX in Frankfurt were both edging higher after Japan's Nikkei Hong Kong's Hang Seng ended with gains.

Copyright 2009 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. AP contributed to this report.